GBP/USD: pathway now clear towards party you might be asking?

GBP/USD has been reported to have made a low on 1.12 handle at a particular broker while Reuter's low was 1.1378.

GBP/USD crashed through 1.2600 earlier to aforementioned levels, but has since found its way back to 1.2482 last high with price at 1.2460 currently with players entering in for cheap sterling.

There are no clear understandings behind the move still, but the usual ideas of either a fat finger or a flash crash from an algorithmic system without liquidity from any banks to save the day anymore, especially in such early Asian hours, will come out as the culprit, but it is going to have major consequences when markets walk into Europe, that is for sure.

This has all come about this week after U.K. PM May warned of a hard Brexit. However, this could even see some of the smaller brokers close shop, many accounts will have been wiped out and this now exposes the downside for the pound in a major way, and quite frankly, I am having to swallow some humble on this one for the time being, (Brexit: putting " Made in Britain" back on your t-shirts) although I had written before Brexit that it is feasible that the pound really could move towards parity to the dollar if markets want to take it there. Given that there are very few major banks acting as market makers anymore and machines are taking over, we can expect more of these kinds of moves and see them more frequently as well.

Meanwhile, French President Hollande came out with a strong statement about Britain's negotiations when he said, "Britain must suffer the consequences of leaving the EU in order to save the institution from an existential crisis", adding,"There must be a threat, there must be a risk, there must be a price. Otherwise, we will be in a negotiation that cannot end well."

GBP/USD levels

Current price is 1.2448, with resistance ahead at 1.2602 (Yesterday's Low), 1.2613 (Daily Classic S3). Next support to the downside can be found at 1.2390, 1,2340, 1.2320, 1,2200, 1.2109 and 1.1950.

Technicals are blown away here but analysts at Commerzbank offered a Long term trend outlook (1-3 months): Target 1.2200, then the 1.0463, the 1985 low.