GBP/USD outlook shifted to bearish – UOB

FX Strategists at UOB Group shifted their stance to bearish for Cable, expecting a potential test of the 1.2200 handle in the near term.

Key Quotes

“While we stated on Monday that GBP has room to extend lower to 1.2345/50, the weakness is more impulsive than expected as the break of 1.2345/50 led to a sharp drop to 1.2261 at the time of writing”.

“The decline is accompanied is strong downward momentum and we expect the current weakness to extend further to 1.2200 (rising daily trend-line support). This is a rather key level and a break could lead to acceleration lower towards the 1.1983 low seen in January. Stop-loss is at 1.2410. Those looking to sell may likely to wait for ‘better levels’ near 1.2315/20”.