GBP/USD: Break of 1.30 materializes, fresh 31-year low

GBP/USD continues to depreciate in thin market conditions, currently breaking through 1.30 to print fresh 31 year lows, as the market continues to price in expectations for rate cuts by the Bank of England amid the unstable environment caused by the UK's decision to exit the European Union. 

BoE turns dovish post Brexit

As Matias Salord, Analyst and News Eitor at FXStreet, notes: "The pound came under renewed pressure following the release of the Bank of England’s Financial Stability Report where Governor Mark Carney showed more worries about the economy and the financial outlook for the UK. Next week, for the first time in years, the meeting of the Monetary Policy Committee will be an event to watch closely with potential large implications."

GBP/USD technical outlook

Technically, Matias observes that "even though technical indicators show extreme readings, price action appears to be strong. The 1.3000 is a relevant psychological level to watch and key for the next hours. A break below could unleash volatility across financial markets." On the upside, should the pair fail to materialize a break through 1.30, "the bearish pressure could ease if the pair manages to rise above 1.3210, where the 20-SMA in the 4-hour chart stands", Matias wrote.