The British Pound (GBP) is showing signs of continued downward momentum, potentially breaking below the 1.2600 mark, according to analysts at UOB Group. Despite the sharp selloff to 1.2616, the next significant support level at 1.2550 is not yet expected to come into play due to current oversold conditions.
24-Hour View:
The unexpected sharp selloff in GBP to a low of 1.2616 deviated from anticipated range trading. Strong downward momentum indicates a potential break below the major support at 1.2600. However, due to oversold conditions, the subsequent major support at 1.2550 is unlikely to be tested at this stage. Immediate resistance levels are identified at 1.2630 and 1.2650.
1-3 Weeks View:
UOB Group has maintained a negative outlook on GBP since early last week. Following GBP’s drop to 1.2622 and subsequent strong rebound, it was noted on June 25 (spot at 1.2680) that the slowdown in momentum reduced the likelihood of GBP weakening to 1.2600. It was also mentioned that only a breach of 1.2705 would signal stabilization of GBP’s weakness. However, with GBP plummeting to 1.2616 yesterday, downward momentum is gaining traction again. A break below 1.2600 appears increasingly plausible, with the next key level to watch at 1.2550. On the upside, the ‘strong resistance’ level has been adjusted lower to 1.2680 from 1.2705.
This analysis suggests close monitoring of GBP’s movements around the 1.2600 level, with attention to potential shifts in momentum and support/resistance thresholds.
Related Topics:
