The GBP/USD pair quickly started to lose ground after the US personal income data reports registering a 0.5% growth compared to the anticipated 0.3%.
Due to the clear advantage of the USD, the pair started dipping more and more starting from 1.2740 on the 25th of June with a slight correction on the 28th.
However, the bearish trend seems to have spilled over to July as well as the pairs have started the month in the negative zone, heading fast towards the 1.2600 round figure mark and hoping to maintain the 1.2500 psychological marks.
But by the way, things are looking right now, and slowly progressing Brexit talks, it seems like the pair will continue its way down or maintain a frozen level between 1.2600 and 1.2500 marks before the end of the week.
Some positive news?
We also have a new immediate strong barrier at 1.2725 with a 1.2760 resistance level, but it’s unlikely the pair to reach such a bullish level in the wake of US-China trade talks and the DMZ visit by Trump.
The USD is getting stronger and stronger, something Trump doesn’t want but can’t really influence due to outside developments such as the EU banks mulling over negative interest rates.
Overall, the fundamentals also look quite bleak for the GBP/USD pair as the Dollar is going to continue its consolidation, while the GBP is lacking in any major developments in the economy as well as the market sentiment.
It’s quite likely to see the pair continue its downfall around the 1.2500 marks and continue a steady pace before October hits and new bullish or bearish news is released about Brexit.
Overall, it’s quite a turbulent time for the pair, and traders are advised to maintain shorting positions in the next few weeks until we get a complete rundown of the G20 talks and how the UK will be affected.