Brexit continues to weigh on the pound, while the Fed's hawkish noises have hit US stocks.

GBPUSD

GBPUSD_May20_zoomout

Since Monday's low trade of 1.43328 price recovered to trade as high as 1.46641 on Thursday, breaching the down trend line from Augusts 2015. However this bullish momentum has so far failed to continue as cable retreated from this potential resistance. Should this bearish sentiment continue throughout the trading GBPUSD could be forming a bearish candle pattern of an evening star, which interestingly has or is forming at the resistance of the down trend line. Should prices take a turn lower potential support lies at 1.4532 and 1.4413 respectively. Moreover should the bulls come back in and push this market higher short term resistance could be seen at the 1.4664 and 1.4770 levels.

GBPUSD_May20_zoomin

S&P 500

SP500_May20

Price activity has been rather subdued in the S&P 500, trading in a range between 2040/2072 having touched as low as 2025.4. Evidently the market is maintaining the 23.61% retracement level of 2040.9, moreover this level coincides with an internal trend line from the November highs and the potential neckline. Should these levels fail to hold as support we could witness the break of the neckline of the head and shoulders pattern with a measuring objective of 1967.0 suggestion that the bears would dominate this market. However should the 2040.0 hold and see bullish sentiment prevail resistance will remain around the 2066/72 zone and should this materialise this could present the market with a break of the down trend line from Aprils highs.  

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