The pair has been offered in Europe and US after UK PM Theresa May said she will invoke article 50 by March 2017. She also said that it could be a hard Brexit – meaning the country would retain the right to determine immigration against access to free markets.
Consequently, Sterling is suffering across the globe. However, the reaction looks slightly irrational as –
• Eurozone would be equally hit if UK loses access to common markets. However, Euro is somehow resilient that too despite Deutsche Bank concerns.
• Furthermore, PM setting the date for invoking article 50 has taken out uncertainty.
Nevertheless, the currency pair is sliding and clocked a low of 1.2825 levels.
Technicals – oversold on intraday time frames
There is bullish divergence on 15- min charts, while the hourly RSI and 4-hr RSI are oversold.
Hence, the spot could revisit area around 1.2980 levels, which is the falling trend line hurdle on the 15-min chart.
On the lower side, 1.2789 (post Brexit low) is a major support.
Consequently, Sterling is suffering across the globe. However, the reaction looks slightly irrational as –
• Eurozone would be equally hit if UK loses access to common markets. However, Euro is somehow resilient that too despite Deutsche Bank concerns.
• Furthermore, PM setting the date for invoking article 50 has taken out uncertainty.
Nevertheless, the currency pair is sliding and clocked a low of 1.2825 levels.
Technicals – oversold on intraday time frames
There is bullish divergence on 15- min charts, while the hourly RSI and 4-hr RSI are oversold.
Hence, the spot could revisit area around 1.2980 levels, which is the falling trend line hurdle on the 15-min chart.
On the lower side, 1.2789 (post Brexit low) is a major support.
