The Pound dropped in a free fall after breaking the support specified in Friday’s report 1.5690, and reached the target 1.5614 successfully. This morning, a new bottom was reached at 1.5532. It seems that this sharp trend is not tired yet, especially after breaking the falling trend channel to the downside, which contributed to this sharp drop.

Thus, we will maintain a negative outlook, as long as the price is trading below the bottom of the channel which is at 1.5704 currently. And even though the price is far from this level at the moment, we will consider this to be resistance of the day, and only if it is broken that we will change our long held negative outlook. If this surprise happens, and we break 1.5704 we will target short term Fibonacci retracement levels 1.5800 & 1.5862. As for the support it is at the nearby 1.5543, and breaking it would indicate that this Dollar tornado will not stop soon, targeting 1.5445 & the important 1.5350.

Support:

• 1.5543: intraday support.
• 1.5614: Nov 28th 2008 high.
• 1.5512: May 12th high.

Resistance:

• 1.5704 the bottom of the falling broken trend channel.
• 1.5800: Fibonacci 50% for the last drop from 1.6067.
• 1.3863: Fibonacci 61.8% for the last drop from 1.6067.