Situations are deeply oversold, however there is no such thing as a clear signal that Pound Sterling (GBP) weak point has stabilised towards US Greenback (USD); any additional decline is unlikely to succeed in 1.3300. Within the longer run, worth motion continues to recommend GBP weak point; the subsequent technical goal is 1.3300, UOB Group’s FX analysts Quek Ser Leang and Peter Chia notice.
Value motion continues to recommend GBP weak point
24-HOUR VIEW: “Following the sharp drop in GBP final Friday, we indicated yesterday that ‘whereas circumstances are oversold, the decline has not stabilised’. We identified that ‘so long as GBP holds under 1.3480, it may take a look at 1.3400’. We additionally identified that ‘the key assist at 1.3365 is unlikely to become visible’. Our directional view was right, however we didn’t anticipate GBP to breach each 1.3400 and 1.3365 so simply (low has been 1.3352). Though circumstances are deeply oversold, there may be nonetheless no clear signal that the decline has stabilised. That mentioned, any additional decline is unlikely to succeed in 1.3300 (notice that there’s one other assist degree at 1.3335). Resistance ranges are at 1.3390 and 1.3420.”
1-3 WEEKS VIEW: “Whereas we turned unfavourable on GBP yesterday (28 Jul, spot at 1.3440), we famous that ‘it’s too early to find out if it will possibly attain the key assist at 1.3365’. Our view was right, however we didn’t anticipate the sharp plunge to 1.3352. The worth motion continues to recommend GBP weak point, and the subsequent technical goal is 1.3300. We’ll preserve our unfavourable view so long as 1.3465 (‘robust resistance’ degree was at 1.3510 yesterday) just isn’t breached.”
