The Pound Sterling (GBP) is up 0.6% in opposition to the US Greenback (USD) and performing in step with its friends, responding to Fed developments which are weighing on the USD extra broadly, Scotiabank’s Chief FX Strategists Shaun Osborne and Eric Theoret report.
Momentum is confirming the recent highs in spot
“These developments are lending the pound some basic help as softer US yields carry the GBP through UK-US spreads. domestically, fee expectations stay regular with markets nonetheless pricing roughly two 25bpt fee cuts by yr finish. By way of information, the CBI retail sentiment figures confirmed a significant deterioration (and disappointment).”
“The pattern is bullish and momentum is confirming the recent highs in spot. The RSI is at 66, nonetheless shy of the overbought threshold that marked its current peaks in March and April. GBP/USD has reached the anticipated resistance degree at 1.3750, providing a doable near-term reprieve.”
“We see no main resistance forward of the psychologically necessary 1.40 degree and proceed to spotlight the significance of medium-term help on the 50 day MA (1.3430). Close to-term help is anticipated nearer to 1.3600.”
