Cable remains on the defensive following the ‘Brexit’ vote last week, now targeting the 1.3000 area, according to the research team at UOB Group.
“The weak opening in Sydney this morning coupled with the subsequent sharp drop from the opening level of 1.3600 suggests that selling pressure remains strong. Unless GBP can reclaim 1.3600, more importantly 1.3770, a retest of last Friday’s 1.3225/30 low would not be surprising”.
“While further GBP weakness would not be surprising, the record breaking drop last Friday is severely over-extended. That said, the 1.3225/30 low appears to be a tenuous support and a move to 1.3000 in the coming days would not be surprising. Resistance is at 1.3770 but only a move back above last Friday’s NY high of 1.3980 would indicate that a temporary low is in place”.
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