Here's where charts say sterling is heading

Sterling versus US dollar (GBP:USD)

"Giant Asteroid to wipe out entire planet" looks like an Express/Mail/FT type of headline where the devil will be in the detail. It could be next week, it could be a million years ahead, it might just be a movie.

Unfortunately, many of the financial gurus resort to this sort of nonsense even when tweeting, and it's really irritating knowing we're about to be deluged with email questions.

Recently, it has been the GBP:USD relationship driving people slightly nuts as it appears on each occasion Mrs May is perceived as doing or saying something silly, some pundit oozes out from under a rock, publish a chart, and foretell a grotty future.

Thankfully, there are signs the idiots who cry wolf at every excuse are becoming more shrill as they appreciate the public are not paying attention. Except, of course, those on Twitter who slavishly retweet anything which matches their particular bias.

And so, this should be a cracker! We're now taking the GBP:USD relationship sliding to $0.57 fairly seriously! To utterly cancel the prospect, the pairing needs to better $1.4 and currently it's quite a bit below.

The real problem comes from a report we published at the start of April when we'd given the pairing an immediate target of $1.30, something it achieved but completely failed to better despite repeated attempts.

While above $1.30 signals the potential of $1.35 initially with secondary, if bettered, at $1.49, the lack of upward integrity gives us a real problem.

At time of writing, the pair trades at $1.289, and we'd have some pretty real concerns should it now slip below $1.274, as $1.248 appears probable very quickly. Secondary, if such a point breaks, comes in at $1.20.

Critically, achieving $1.20 would equal the previous lows with the result that anything below is very capable of provoking parity.

Unfortunately, when we zoom out and view 40 years of squabbles, parity seems not the end of the story as our software reports $0.57 as a point at which the relationship must bounce.

Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.

Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang, Shareprice, or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea. 

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