GBP/USD: Further losses forecasted on a breach of 1.2970 – UOB
|Cable faces further losses on a breakdown of the 1.2970 level, suggested FX Strategists at UOB Group.
Key Quotes
24-hour view: “Our expectation for GBP ‘to consolidate and trade between 1.3020 and 1.3125’ was incorrect as it plummeted to 1.2982 before rebounding sharply to end the day little changed at 1.3071 (-0.05%). The rapid rebound appears to have room to extend higher but for today, a break of 1.3125 appears unlikely (next resistance is at 1.3170). Support is at 1.3040 followed by 1.3010. The 1.2982 low is likely ‘safe’ for today.”
Next 1-3 weeks: “While we have expected GBP to strengthen since 21 Jul (spot at 1.2670); in our latest narrative from last Thursday (30 Jul, spot at 1.2980), we held the view that GBP ‘could continue to advance but any potential gain is likely to be relatively modest. Next resistance is at 1.3080’. However, GBP blast past 1.3080 and surged to a high of 1.3170 last Friday. The subsequent sharp and rapid pull-back has dented the upward momentum considerably and this coupled with overbought conditions suggest the rally in GBP could be coming to an end soon. From here, unless GBP moves and stays above 1.3170 within these few days, a breach of 1.2970 (‘strong support’ level previously at 1.2850) would indicate that the current positive phase in GBP has run its course.”
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.