GBP/USD falls to a low of 1.1962, just shy of the 2019 low of 1.1959
If the September 2019 low gives way, the post-Brexit referendum low @ 1.1841 awaits for cable and it could be a really slippery slope once that level gives way.
Again, the technical picture continues to suggest a really painful moment for cable and the pound over the past week or so. And as we take out more key levels along the way with little to no reprieve, it is not wise to be catching the falling knife.
Fundamentally, there is also little to work with for the pound as post-Brexit negotiations continue to go nowhere and dollar funding pressure continues to underpin the greenback – alongside the fact that the UK virus situation is also going to get worse.
At least the BOE and the UK government are stepping up big time and coordinating well, but so far the market is less than impressed by the proposed measures.
The only thing I can argue in favour of the pound is that historically, these levels may be attractive from a valuation perspective.
But as I highlighted earlier, unless there is a change in market sentiment or in the near-term technical picture, there is little reason to go rushing in with both feet.
Update: Cable now hits new lows since 2016 as it takes out the 1.1959 level.