GBP/USD extends slide to 1.2815 amid Brexit concerns

• The pound is the worst performer among majors, weakened by no-deal Brexit concerns.
• GBP/USD falling for the first time after a 5-day rally.

The GBP/USD pair broke to the downside after the beginning of the US session and printed a fresh daily low at 1.2815. From yesterday’s high, it has fallen more than a hundred pips as it continues to erase weekly gains. As of writing, it was trading at 1.2830, posting the first daily loss in a week.

The pound is among the weakest currencies on Thursday. The slide accelerated as investors digest the document presented by the UK Brexit Department with contingency plans in the case of a no-deal Brexit. The technical note is the first of a serious, presenting possible scenarios if a deal is not reached before March 2019.

Weaker-than-expected US PMI data failed to push the pair to the upside that resumed the downside during the US session. The flash PMI Composite Index fell to 55.0 in August, the lowest in 4 months. “The US economy lost a little pace in August, according to the flash PMI, but continued to grow at a solid rate. The PMI is indicative of the economy growing at an annualised rate of roughly 2.5%, down from a 3.0% indicated rate in July”, said Chris Williamson, Chief Business Economist at IHS Markit.

GBP/USD Short-term Levels to watch

To the downside, immediate support is seen around the 1.2790 followed by 1.2775 (uptrend line from Aug 15 low) and 1.2750. On the upside, resistance could be seen at 1.2845 (European session low), 1.2910 (Aug 23 high) and 1.2935 (Aug 22 high).