GBP/USD neutral/bearish near term – Scotiabank

Shaun Osborne, Chief FX Strategist at Scotiabank, did not rule out a breakdown of the 1.3100 handle in the near term.

Key Quotes

“Sterling’s recovery from the pummelling seen late last week has stalled – about where the technical signals suggested it would likely meet strong resistance”.

“The sharp drop in the pound late last week left a large gap on the hourly charts between 1.3150/1.32 and gains through late yesterday and into the overnight session have moved to fill (largely) that gap which now serves as strong resistance”.

“The turn lower in the pound from the high 1.31s suggests Cable remains at risk of a push under 1.31 following last week’s low close”.