GBP/AUD: smashed to 2012 resistance, but what is going on with Sterling?

GBP/AUD is currently consolidating he huge supply in sterling that started out in early Asia, but what had been mounting up ever since last weekends announcements from UK PM May.

May is warning us all that it will be a hard Brexit and markets got spooked. The pound was sold off at the open last week and while it did manage to find demand as markets digested the idea that of course Brexit will be hard, but just not right now with plenty of time ahead for developments and negotiations to take place still. However, it was today that the pound suffered its biggest drop since Sunderland voted in the EU referendum, but amazingly it fell so far in just two minutes which leads markets to guess that it could have been either a fat finger or a flash crash from an algorithmic system with moves exaggerated in illiquid markets.

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/AUD levels

Current price is 1.6345, with resistance ahead at 1.6385 (Daily Classic S3), 1.6499 (Daily Classic S2), 1.6566 (Daily Classic S1), 1.6614 (Yesterday's Low) and 1.6626 (Hourly 20 EMA). Next support to the downside can be found at 1.5663 (Daily Low), 1.4434 and 1.4380.