The GBP/USD pair has been in a free-fall for the past 5 weeks. The pair has blown through Support & Resistance zones that have historically given the pair, at the very least, pause but hardly register as speed-bumps this time around. With the Non Farm Payroll being released in the USA later today, and the pair currently sitting on another solid Support level of 1.5375, could this be the level it finally takes a breath at? With growing concern over European financial issues, investors have been flocking to the Greenback once again as a so called 'Safe Haven' which has resulted in the USD gaining strength against most currencies around the globe. But, worse than expected numbers from the NFP could change all that, at least temporarily. If the numbers are negative we could see the GBP, along with many other world currencies regain some ground. However, if the US economy continues to 'steadily improve' as one analyst put it, the GBP could make new 12 month lows before trading closes this week. Currently the pair appears that it may be setting up to form a triple bottom at 1.5300 before reversing, with 1.5300 being a 'line in the sand' for many large institutions. If 1.5300 support fails, there is a technical vacuum below that could see the pair fall as low as 1.5100 very quickly. If prices do reverse, look for resistance at 1.5500 & 1.5590 before re-testing the Monthly Pivot level at 1.5670.
Happy Trading