GBP/USD: Bears to break the support at 1.2710 – UOB Group
|The Pound Sterling (GBP) is expected to drift lower; given the mild downward pressure, any decline is unlikely to break the support at 1.2710, and the chance of GBP dropping below 1.2665 is low, UOB Group FX analysts Quek Ser Leang and Peter Chia note.
A sustained break below 1.2710 is unlikely
24-HOUR VIEW: “Last Friday, GBP traded in a range of 1.2727/1.2773, closing largely unchanged (1.2756, +0.04%). Despite the quiet price action, there has been a slight increase in downward momentum. Today, we expect GBP to drift lower. Given the mild downward pressure, any decline is unlikely to break the support at 1.2710. On the upside, resistance levels are at 1.2780 and 1.2800.”
1-3 WEEKS VIEW: “We turned negative in GBP late last month (see annotations in the chart below). After GBP fell to 1.2674, in our most recent narrative from last Wednesday (07 Aug, spot at 1.2690), we indicated that ‘the rejuvenated momentum indicates that the risk remains on the downside, and the levels to watch are 1.2645 and 1.2610.’ GBP subsequently dropped to 1.2665 and then rebounded strongly, reaching a high of 1.2773 last Friday. While our 'strong resistance’ level at 1.2780 has not been breached yet, downward momentum has eased considerably, and the chance of GBP dropping below 1.2665 is low. To look at it another way, if GBP breaches 1.2780, it would suggest that GBP has entered a consolidation phase.”
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.