GBP/USD has been under pressure from a resurgent dollar and pessimism over the chances of a Brexit agreement.
The European Union had told Britain to rework its proposal by Friday, but a British source said on Thursday the Brexit impasse was unlikely to be broken before the weekend because the EU was not moving nL5N20U6Y4.
That helped GBP/USD close down 90 pips on Thursday, the biggest one-day drop since Feb.
5, weakening the underlying market structure.
Cable closed below the 1.3129 Fibonacci level, a 23.6 percent retrace of the 1.2409 to 1.3351 2019 rise.
That increased the risk for an eventual test of the 1.2991 Fibonacci level, a 38.2 percent retrace of the same 1.2409 to 1.3351 gain.
Fourteen-day momentum is still positive, however, so those bearish the pound should exercise caution and watch for the outcome of the Brexit talks nL1N20S0B5.
Daily Fibo Chart: Click here