GBP/USD could see some recovery near term – Commerzbank

In view of Karen Jones, Head of FICC Technical Analysis at Commerzbank, Cable could extend further its current upside momentum.

Key Quotes

“GBP/USD has failed to break below 1.30 and the recovery has taken it above the 20 day ma at 1.3201. This has neutralised the immediate outlook and suggests some scope for near term recovery. Above the 20 day ma we have 1.3534, the 29th June high. we remain unable to rule out a rally to 1.3638, the 38.2% retracement and potentially 1.4158, the 61.8% retracement of the recent sell off”.

“The intraday Elliott wave count suggests that the market is not ready to go sub 1.30 yet, failure here is needed to trigger a slide to 1.2885/1.2750. Support at 1.2750/78.6% retracement of the move from 1985 to 2007 is regarded as the last defense for the 1.0463 1985 low”.