GBP/USD rangebound expected between 1.30/1.32 – Scotiabank

In view of Shaun Osborne, Chief FX Strategist at Scotiabank, Cable is seen within a consolidative theme between 1.30 and 1.32 in the short term.

Key Quotes

“Sterling is looking slightly better supported following the release of weak – although still slightly better than expected retail sales data. Sales rose 0.3% in the Oct month, partially reversing the 0.7% m/m drop seen in Sep. Surveys had suggested the drop in sales might be more significant. Core sales (ex-fuel) look soft, however, rising just 0.1% in the month and falling 0.3% in the year. The data give some credence to concerns that rising inflation is pinching UK consumers amid low real wage growth. UK parliamentary discussions of the Brexit Bill continue amid signs of divisions in PM May’s Conservative party, meanwhile. All things considered, we are not inclined to look favourably on the GBP at the moment”.

“Sterling looks firm but is trading near the top of the range that has persisted since the start of the month and lacks sufficient momentum to break higher at the moment, we fee. Key daily resistance remains 1.3231 (40- day MA) and a clear push above here is a pre-requisite for an improved tone on the pound technically, we feel. Trend support is 1.3080. We look for more range trading between 1.30/1.32”.