GBP/USD drops to lowest since June 1985

In a thin liquidity environment, GBP/USD pair witnessed another wave of selling that took prices down to 1.2792; the lowest level since June 1985.

Double blow of recession and monetary easing

Markets see UK economy slipping into recession this year as a result of the Brexit shock. This has also triggered speculation that Bank of England would cut the interest rate this summer. This is a double blow for the British Pound.  

Consequently, Cable and other GBP pairs continue to slide in Asia. It remains to be seen if the European desks attack the pound with fresh offers or keep the doors open for a corrective move.

GBP/USD Technical Levels

At the time of writing, the pair was trading around 1.2820. A major support is seen at 1.2765 (November 1984 high) and 1.2524 (Oct 1984 high). On the other hand, major resistance is seen at 1.30 and 1.3340 (monthly high).