Domino effect.
The effects of the banking crisis in the United States (US) are now spreading to Europe when it is reported that the giant Swiss investment bank Credit Suisse is facing the same fate as Silicon Valley Bank (SVB) and several others.
Because of that, the Swiss franc (CHF) suffered a decline and also dragged other European currencies including the Pound to continue to plunge on Wednesday trading yesterday.
While the US dollar, which previously displayed a gloomy performance since the opening of trading earlier in the week, returned to strength again due to increased demand for the safe-haven.
This situation has changed the direction of price movement on the chart of the GBP/USD currency pair yesterday.
If you look at the previous bullish movement, the price has made an increase reaching the height of 1.22000 at the beginning of the week.
However, the flat price in the resistance zone changed direction again when a drastic plunge was exhibited yesterday.
The price dropped past the 1.21000 level and headed for the 1.20000 concentration zone before rebounding slightly at the close of the New York session.
The price movement below the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the GBP/USD chart again gives a clear indication of a bearish trend change for the price.
It is very likely that the decline will continue based on the pattern displayed yesterday with the expectation that the price will drop below the 1.20000 zone.
Next, the price is seen to return to the zone around 1.19000 which was also the focus zone before.
However, if the price manages to display a surge again and pass the 1.21000 level, the 1.22000 resistance zone will again be a target to be tested.
After that, the price will resume the surge pattern of last week and potentially reach a height of around 1.23000.
