Overview:
Coronavirus sees pound dropping straight down to seven month low.
The unfavorable news will surely impact on currencies because it comes as countries worldwide force travel bans and close borders.
The GBP/USD pair has dropped sharply from the level of 1.3199 towards 1.2084. Now, the price is set at 1.2110.
It should be noted that volatility is very high for that the GBP/USD pair is still moving between 1.2347 and 1.1961 in coming days.
In the long term, the price has been set below the strong resistance at the levels of 1.2347 and 1.2641, which coincides with the 23.6% and 50% Fibonacci retracement level respectively.
Additionally, the price is in a bearish channel now. Amid the previous events, the pair is still in a downtrend. From this point, the GBP/USD pair is continuing in a bearish trend from the new resistance of 1.2347.
The price spot of 1.2347 remains a significant resistance zone. Therefore, a possibility that the GBP/USD pair will have downside momentum is rather convincing and the structure of a fall does not look corrective.
In order to indicate a bearish opportunity below 1.2347, sell below 1.2347 or 1.2250 with the first targets at 1.2003, 1.1960 and 1.1835. However, the stop loss should be located above the level of 1.2641.
