GBP/USD Forecast: Bearish as the UK prepares for a no-deal Brexit

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GBP/USD Current price: 1.2917

  • UK PM Johnson said that local business should get ready for an Australia-type deal with the EU.
  •  EU chief negotiator Michel Barnier´s visit to London this week put at doubt.
  • GBP/USD is technically bearish, could extend its slump towards the 1.2800 price zone.

The GBP/USD pair seesawed between gains and losses by the end of the week, ending the day unchanged yet around 1.2915, down from its Monday’s opening. The British Pound was hit by comments from UK PM Boris Johnson, who said that local business should get ready for an Australia-type deal with the European Union, “given the EU have refused to negotiate seriously.¨ Even further, he said that talks with the EU were over, adding that EU’s chief negotiator Michel Barnier should only come to London this week “if he is prepared to discuss all of the issues on basis of a legal text.” Barnier was due in London for talks with his counterpart, David Frost.

The United Kingdom didn’t publish relevant data on Friday and is due to a slow start of the week, as it will only release the October Rightmove House Price Index, while BOE’s member  Cunliffe is scheduled to speak.

GBP/USD short-term technical outlook

According to the daily chart, the GBP/USD pair is neutral, as it spent the week trading above a flat 20 DMA, which holds above the larger ones, also directionless. Technical indicators, in the meantime, have retreated within positive levels, now hovering around their midlines. According to the 4-hour chart, the pair is at risk of falling, as it settled around a mildly bullish 100 SMA but below a bearish 20 SMA, as technical indicators turned south within negative levels.

Support levels: 1.2895 1.2850 1.2810

Resistance levels: 1.2940 1.2995 1.3040

View Live Chart for the GBP/USD