GBP/USD has extended its rejection of its 200-day average and remains below its falling 55-day average, which have also completed a bearish ‘death cross’, per Credit Suisse.
“With a bearish moving average ‘death cross’ in place we stay biased lower for a test of key support at 1.2176/66, the April low and 38.2% retracement of the entire rise from March.”
“Below 1.2176 would mark a more important top as we highlighted yesterday to open up a move to the 50% retracement at 1.2030, then 1.1934/32, the ‘neckline’ to the March base.”
“Resistance moves to 1.2389 initially, then 1.2407/08, with 1.2421 now ideally capping to keep the immediate risk lower. Above can raise the prospect of further sideways ranging and strength back to 1.2518/22.”