GBP/USD consolidating the mega-crash above 1.2400

The cable traded extremely volatile so far this Friday, and now consolidates the Asian crash as we step into the early European session.

GBP/USD doomed by ‘Fat finger’ error

The bears are seen taking a breather after having witnessed almost 6% slump pre-Tokyo open, with markets blaming French president Hollande’s hard-Brexit. While reports of a Fat finger error, which drove the algo-trades hay-wire also collaborated to the collapse in the GBP/USD pair.

The major crashed from near 1.2615 level to fresh multi-decade lows of 1.1841 in matter of minutes, before recovering almost 6 big figures to now trade around 1.2430 levels, still down -1.50% on the day.

Markets are expecting fresh sell-off in the cable once the European traders hit their desks and absorb the latest mayhem around the GBP. Meanwhile, the big event for today remains the US payrolls data, which is likely to add legs to the US dollar rally, exacerbating the pain in the major.

GBP/USD Levels to consider            

Omkar Godbole, Analyst at FXStreet noted, “Round figures could continue to act as a support on the downside. If we plot Fib extensions on a move from July 2014 high – Apr 2015 low – June 2015 high suggests a strong support does exist around 1.2217 (141.4% Fibo extension).”

“On the higher side, 1.2458 (61.8% of Nov 2007 high – Jan 2009 low – July 2014 high) could act as a resistance, above which 1.26 could be put to test.”