The U.K. is officially out of the E.U. and the GBP/USD is on the bear. With only a few hours to go in the forex session, rates have fallen beneath the key 1.3000 psychological barrier. At this point, the optimism of last Friday is long gone and currency players are snatching up Greenbacks instead of the pound Sterling.

Aside from this morning’s ISM Manufacturing PMI (Jan.) there haven’t been a whole lot of fundamental market drivers. However, it is worth noting today’s U.S. T-Bill auctions:

Event                                                 Actual     Previous

3-Month Auction                                1.55%        1.53%

6-Month Auction                               1.520%      1.535%

All in all, there aren’t too many headlines to be made from this set of bond auctions. Yields came in relatively flat, with investors passing on the 6-Month issues. While T-bills have been popular among institutional players over the past 18-months, it looks like February may turn out to “risk-on” for a majority of market participants.

Fibonacci Support In View For The GBP/USD

For the past 10 sessions, the 1.3000 number has been a biggie for the GBP/USD. Monday’s action has brought another test of this level. At this point, it looks like rates may be ready to leave this area.

There are a few intermediate-term levels worth watching in this market:

• Resistance(1): Weekly SMA, 1.3056
• Support(1): 38% Current Wave, 1.2919
• Support(2): Bollinger MP, 1.2813

Bottom Line: As the Tuesday session rapidly approaches, a buying opportunity may be setting up in the GBP/USD. Until elected, I will have buy orders in queue from 1.2926. With an initial stop loss at 1.2894, this trade produces 50 pips on a near-1:2 risk vs reward ratio.