GBP/USD short-term outlook remains negative – Commerzbank

In view of Karen Jones, Head of FICC Technical Analysis at Commerzbank, Cable’s near term perspective stays negative.

Key Quotes

“Sterling last week failed to close above its near term resistance at (1.2579/81 February 9 th high, and the 78.6% retracement), and our negative bias remains. It has yet to close below the 55 and 100 day moving averages but we look for this to happen this week. Intraday Elliott counts are positive, but overhead the market faces the channel at 1.2640 and the 200 day ma at 1.2660. Below 1.2347 (Feb low) would cast attention back to the 1.2110 recent low. This is considered to be the last defence for the 1.1988 January low”.

“Key near term resistance is the top of the channel at 1.2640. Only above the 1.2707 February high would allow for further strength to the 1.2776 December high to be seen. Between it and 1.2836 lie several Fibonacci retracements and major resistance and we suspect that it will fail there”.