According to Economist Lee Sue Ann and Market Strategist Quek Ser Leang of UOB Group, GBP/USD could extend the bearish move to the 1.2305 level in the short term.
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24 hour view: Last Friday we highlighted that “GBP/USD is likely to weaken further” and that “severely oversold conditions suggest that a sustained break below 1.2355 is unlikely.” GBP/USD weakened less than expected and fell as low as 1.2380 before settling at 1.2383 (-0.23%). Conditions remain oversold, but with no signs of stabilization yet, GBP/USD could fall to 1.2355 before the risk of a more sustained rebound increases. Main support at 1.2305 is very unlikely to appear. Resistance lies at 1.2420, followed by 1.2445.
Next 1-3 weeks: Our update from last Friday (September 15, GBP/USD at 1.2405) is still valid. As we have highlighted, the GBP/USD weakness that began about two weeks ago has not stabilized, and GBP/USD could continue to weaken. The next level to watch is the May low near 1.2305. To the upside, a break of the “strong resistance” level at 1.2485 (no change in level since last Friday) would mean 1.2305 is out of reach this time.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
