Sterling is a clear underperformer on the session, although Cable losses are moderate on the day and it is trading off the earlier low. Economists at Scotiabank analyze GBP outlook.
Gains above 1.2400/1.2405 in the short run may stabilize Cable
Sterling has rebounded from the previous session’s lows but the pound still hit new, short-term cycle lows (back to its weakest since late May) and broader price patterns are bearish.
Trend resistance is capping GBP gains at 1.2400/1.2405. Gains above here in the short run may stabilize the Pound.
The broader bear trend remains well-entrenched across a range of timeframes which suggests Sterling losses are liable to extend – potentially back to the 1.20/1.21 area.
