The pound/dollar pair traded marginally lower Monday, recovering from a low set at 1.2366 during Asian trading hours but barely above the 1.2400 level in a quiet trading session.
No macro news came from the U.K. today, and there are several bank holidays across the world that will likely keep majors within tight ranges until the next Asian opening. Still, the pound will likely remain pressured by Brexit woes and at risk of further slides.
The second U.S. presidential debate has resulted again in a slight victory for Hillary Clinton, but nothing has been so far defined. Nevertheless, risk aversion has somehow eased, with the dollar benefiting across the board.
According to the four hours chart, pound/dollar technical readings are beginning to recover some meaning after Friday's sharp decline, although indicators are still in extreme oversold levels, recovering partially but far from supporting a steeper recovery. In the same chart, the 20 SMA has extended its decline and is currently around 1.2560.
The highest level reached after the latest slump is 1.2476, the level to surpass to confirm further gains up to 1.2520 first and to 1.2600 should the dollar come under selling pressure.
Below the mentioned daily low, on the other hand, the risk turns toward the downside, with scope then to test the 1.2300 region.
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