GBP/USD door open for a test of 1.3534 – Commerzbank

In opinion of Karen Jones, Head of FICC Technical Analysis at Commerzbank, there is scope for Cable to re-test 1.3534.

Key Quotes

“GBP/USD is upside corrective and this correction higher looks set to extend further than we originally thought and we should allow for a rally to 1.3534 and potentially 1.3638, the 38/2% retracement of the recent sell off. This means that we probably got into our shorts too early”.

“The market last week sold off towards and recovered just ahead of the 1.2750/78.6% retracement of the move from 1985 to 2007”.

“Support at 1.2750 is regarded as the last defense for the 1.0463 1985 low”.