BREAKING: GBPUSD pair breaks below July low

Risk aversion dominates the financial markets during today's session, early triggered by power shortages in China, later boosted by a fuel crisis in the UK. Dollar strengthened following recent comments from FED members, while US 10-year yields are up 6 basis points to 1.54%. St. Louis Federal Reserve president James Bullard said the Fed being 'a little' more aggressive would best ensure longer expansion, while seeing 2 interest rate increases in 2022 and inflation remaining at 2.8% through next year. Early, Governor Lael Brainard said the labor market may soon meet her target for tapering to start while New York Fed President John Williams noted that moderating bond-buying may soon be warranted. 

During today's session, the GBPUSD currency pair has fallen sharply. Looking at the D1 interval, the sellers managed to break below the support at 1.3620. It seems that, in line with the classic assumptions of Technical Analysis, today's price action opened the way towards a bigger downward correction, and the aforementioned zone should be treated as a resistance. The Fibonacci external retracement should be treated as the nearest support - 127.2% and 161.8%. Source: xStation5