GBP/USD continues to stretch lower toward mid-1.3400s on Monday as the mood continues to sour. Wall Street's main indexes are down between 1.7% and 2.1% after the disappointing PMI data from the US.
GBP/USD stays below the 100-period SMA on the four-hour chart. Confirming the near-term bearish bias, the Relative Strength Index (RSI) indicator on the same chart continues to move sideways near 40.
On the downside, 1.3530 (Fibonacci 38.2% retracement of the one-month-old uptrend) aligns as the first support. In case this level turns into resistance, the pair could target 1.3500 (psychological level) and 1.3460 (200-period SMA).
Strong resistance seems to have formed at 1.3600 (fibonacci 23.6% retracement, 100-period SMA). A daily close above that level could be taken as a bullish sign and open the door for a more decisive rebound toward 1.3640 (50-period SMA).
