GBPUSD, Daily
GBPUSD has fallen hard this month, falling to the monthly low seen yesterday (September 9) at 1.2884 after entering September at the year high of 1.3481, with this downtrend starting with a shooting star bar visible on the first day of the month. This was accompanied by bearish divergence and was supported by the appreciation of the US Dollar through September.
However, it can be seen that the GBP is in the weakest this month. When compared with other major currencies yesterday, the EURGBP pair made a monthly high at 0.9130, GBPJPY made a monthly low at 136.72, GBPNZD made a low at 1.9407 and GBPCHF made a monthly low at 1.1830.
In the Daily time frame it can be seen that when the pair GBPUSD bounced up from the MA50, the candlestick formed a hammer, with the trend line as the MACD is moving down near the zero line. On a lower time frame like H1, yesterday’s move showed bullish divergence, followed this morning with an uptrend pattern like a bullish flag with significant resistance at the MA50. An upwards break will find the next resistance at 1.3055 while the key support is now at the low 1.2885 zone.
The key point now is the new UK law (Internal Market Bill) that will apply to Northern Ireland on government assistance measures and customs clearance. This has the real and significant risk of hurting the Brexit deal with the EU, as the EU has recently said it will not try to hold off on Brexit talks. Barnier and Frost meet for the final time this week later today.
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Chayut Vachirathanakit
Market Analyst – HF Educational Office – Thailand
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