The British Pound slumped 0.78% overnight to close in New York at 1.2167 from Friday’s 1.2225 opening. Sterling was the worst performing currency against the US Dollar following the release of dismal UK Retail Sales data. Which added further pressure on the British Pound. The UK government has come under increasing pressure regarding its handling of the coronavirus crisis while risks that no free trade deal between the UK and the EU have elevated. Last week the Bank of England policymakers did not rule out negative interest rates.
Sterling traded to an overnight low at 1.21616 and its close was not far away. A break of the overnight low will see the next support at 1.2125 followed by 1.2075. Immediate resistance can be found at 1.2200 followed by 1.2240 (overnight high 1.22336). The latest COT/CFTC report saw a modest increase in speculative short GBP bets to -GBP 13,688 contracts from -GBP12,005.
Look for a likely trade today between 1.2130-1.2230 today. Prefer to sell rallies.