Richard Perry
Independent Analyst
GBP/USD
As with EUR/USD there has been a mild tick higher on Cable as the strength of the dollar rally has just eased in the past 24 hours. However, this is likely to be another chance to sell as the growing medium term pressure on 1.2650 support builds. The trend lower of the past three weeks comes in around 1.2825 today and there is a near term pivot around 1.2860 which we see will likely contain a rally before downside pressure renews. Momentum indicators are far more negatively configured on a medium term outlook now, but are just beginning to tick back higher again. This near term rebound should be seen as a chance to sell. We expect this week’s low of 1.2670 to come under further pressure and how the market reacts around 1.2650 (which is a breakout support band of old highs) will determine whether this move goes much deeper towards 1.2480 and possibly 1.2250 in due course. Above 1.2860 would improve the near term outlook, but the bulls need above 1.3000 to really push ahead once more.
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