GBP/USD room for a near term rebound – Commerzbank
Cable’s recent price action allows for a potential near term bounce, suggested Karen Jones, Head of FICC Technical Analysis at Commerzbank.
Key Quotes
“GBP/USD’s break lower last week through several key supports lacked follow through and was therefore unconvincing and we are allowing for a near term rebound. Resistance is provided by the 20-day ma at 1.3914 and the resistance line at 1.4044. While capped here, the outlook stays negative”.
“Last week the market eroded a band of support at circa 1.3782/1.3763 (55 day ma, the 9th February low and a 4 month uptrend) but did not CLOSE below the 1.3763 level which is why we suspect that it will bounce. Below here lies the 1.3658 September peak and the 1.3479 2016-2018 uptrend. A close below the latter level is needed to confirm the end of the medium term up move (favoured)”.
“Above the 1.4044 resistance line there is scope for a retest of the 1.4345 recent high and the 1.4313 200 week ma”.