According to technicals, Cable faces the prospects of a rebound to the 1.3390/1.3505 band, noted Karen Jones, Head of FICC Technical Analysis at Commerzbank.
“GBP/USD: last week’s new low was not confirmed by the daily RSI, and the market eroded the accelerated downtrend. We look for a small correction higher. It is interesting to note that the Elliott wave count is pointing to a corrective rebound to the 1.3390/1.3505 area, which is extremely tepid. Below 1.3200 will trigger losses to the 1.3040 October low”.
“The March low lies at 1.3712 and this should offer a tough near term barrier. Rallies are expected to remain capped by the 1.3826 55 day moving average and while below here the market will remain directly offered”.