A deeper pullback in GBP/USD appears to be running out of steamUOB Group currency strategists Lee Sue Ann and Quek Ser Leang suggest.
24 hour view: “Yesterday we highlighted that ‘although GBP/USD could weaken further, conditions remain oversold and the next support at 1.2040 is probably out of reach for now’. GBP/USD subsequently fell to 1.2093 before staging a surprisingly rebound strong (1.2189 high). Momentum indicators are turning flat and GBP/USD is likely to consolidate from here. Range expected today 1.2120/1.2205.”
Next 1-3 weeks: “We turned negative on GBP/USD two days ago (June 29, GBP/USD at 1.2185). Going down, we highlighted yesterday that GBP/USD could drop further to 1.2040. Subsequently, GBP/USD fell to 1.2093 before bouncing hard. Short-term bearish momentum is starting to wane and a break of 1.2205 (no change from yesterday’s ‘strong resistance’ level) would indicate 1.2040 is out of reach this time.”
Source: Fx Street