GBP/USD bearish tone intact – UOB

According to FX Strategists at UOB Group, the negative stance around Cable remains unchanged in the near term.

Key Quotes

“Against our expectation, GBP dropped quickly without testing the 1.2340 resistance (high of 1.2300). While lacking in momentum, the decline appears to have scope to extend lower even though 1.2200 is a major level and is expected to offer solid support”.

“Despite the overall bearish indications, the lack of a sustained down-move in GBP is discouraging. However, only a move back above 1.2340 (adjusted from 1.2380) would indicate that the bearish phase that started late last week has ended. In the meanwhile, this pair is expected to continue to drift lower towards 1.2200 even though this is a major support and is unlikely to yield so easily (next support is at 1.2150)”.