GBP/USD: Downside pressure improved – UOB
|GBP/USD could now grind lower and revisit the 1.2040 region in the next weeks, suggested FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang.
Key Quotes
24-hour view: “We highlighted yesterday that the ‘the rapid decline in GBP appears to have room to break the major support at 1.2165’. We added, ‘oversold conditions suggest that the next support at 1.2120 is unlikely to come into the picture’. Our view for a weaker GBP was not wrong even though the extent of the decline exceeded our expectations as GBP dropped sharply to 1.2106. While GBP could continue to weaken, conditions remain oversold and the next support at 1.2040 is likely out of reach for now. On the upside, a break of 1.2175 (minor resistance is at 1.2150) would indicate that the current weakness has stabilized.”
Next 1-3 weeks: “Yesterday (29 Jun, spot at 1.2185), we indicated that the recent consolidation phase. We highlighted that downward momentum is only beginning to build and any weakness from here could be limited to 1.2120 for now. While our view for a weaker GBP was correct, the pace of the decline was more rapid than expected as GBP plummeted to a low of 1.2106. Downward momentum has improved considerably and GBP could decline further to the next support at 1.2040. On the upside, a break of the ‘strong resistance’ at 1.2205 (level was at 1.2285 yesterday) would indicate that the current downward pressure has eased.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.