GBP/USD risks a probable drop to 1.2580 – UOB

Pablo Piovano FXStreet

Further losses now appear on the table for GBP/USD in the short-term horizon, according to Markets Strategist Quek Ser Leang and Senior FX Strategist Peter Chia at UOB Group.

Key Quotes

24-hour view: After GBP fell sharply to 1.2680 on Wednesday, we highlighted yesterday that “While severely oversold, there appears to be enough momentum for GBP to dip below 1.2680.” We added, “The major support at 1.2645 is likely out of reach today.” However, GBP plummeted to 1.2620 in London trade, then snapped back up to close largely unchanged in NY (1.2709, -0.09%). Downward momentum has slowed, and this combined with still overbought conditions, suggests GBP is unlikely to weaken further. Today, GBP is more likely to trade sideways in a range of 1.2670/1.2770.

Next 1-3 weeks: We turned negative in GBP last Friday (28 Jul, spot at 1.2800). In our update from yesterday (03 Aug, spot at 1.2725), we held the view that GBP “is likely to weaken further.” We indicated that “the next level to aim for is 1.2640, followed by 1.2580.” GBP broke below 1.2640 in London trade (low was 1.2620). While downward momentum has eased somewhat with the bounce from the low, there is a chance for GBP to drop to 1.2580. Overall, only a breach of 1.2805 (‘strong resistance’ level was at 1.2830) would indicate that the downside risk has faded.

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

EUR/USD extends its optimism past 1.1900

EUR/USD retains a firm underlying bid, surpassing the 1.1900 mark as the NA session draws to a close on Monday. The pair’s persistent uptrend comes as the US Dollar remains on the defensive, with traders staying cautious ahead of upcoming US NFP prints and CPI data.

GBP/USD hits three-day peaks, targets 1.3700

GBP/USD is clocking decent gains at the start of the week, advancing to three-day highs near 1.3670 and building on Friday’s solid performance. The better tone in the British Pound comes on the back of the intense sekk-off in the Greenback and despite re-emerging signs of a fresh government crisis in the UK.

Gold picks up pace, retargets $5,100

Gold gathers fresh steam, challenging daily highs en route to the $5,100 mark per troy ounce in the latter part of Monday’s session. The precious metal finds support from fresh signs of continued buying by the PBoC, while expectations that the Fed could lean more dovish also collaborate with the uptick.

XRP struggles around $1.40 despite institutional inflows

Ripple (XRP) is extending its intraday decline to around $1.40 at the time of writing on Monday amid growing pressure from the retail market and risk-off sentiment that continues to keep investors on the sidelines.

Japanese PM Takaichi nabs unprecedented victory – US data eyed this week

I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.