GBP/USD set to reach the 1.2165/70 area – Scotiabank

Sterling is a notable out-performer on the day, following better-than-expected UK data. Economists at Scotiabank believe that the GBP/USD could extend its rise to the 1.2165/70 zone.

Sterling’s technical condition looks more positive 

“A surprise monthly budget surplus added to the lift for the GBP as it casts government finances in a generally more favourable light for the fiscal year overall ahead of next month’s budget. The Chancellor might use some of that unexpected cash to ease the domestic cost of living crunch.” 

“The GBP has found support against the 200-DMA (1.1937 today) over the past two weeks and intraday gains through the 1.21 area are bullish from a short-term point of view, setting Cable up for a test of 1.2165/70.”