GBP/USD: Downtrend is slowing near-term but the overall risk stays seen lower – Credit Suisse

GBP/USD weakness has stalled at next key support at the 61.8% retracement of the 2020/2021 uptrend at 1.2494. Analysts at Credit Suisse see scope for a temporary pause here ahead of further weakness to 1.2251. 

Resistance seen at 1.2615, then 1.2697/1.2705

“Our bias remains to continue to look for a near-term pause around the 61.8% retracement of the 2020/2021 uptrend and psychological barrier at 1.2500/1.2494 for some consolidation and potentially a short-term tactical recovery.” 

“With the market remaining clearly below falling medium-term moving averages, and with weekly MACD momentum remaining very strong, we see no reason not to look for a sustained break of 1.2500/2494 in due course, with support seen next at 1.2251, ahead of 1.2072 and then the 78.6% retracement at 1.2017.” 

“Resistance is seen at 1.2615 initially, above which can see a recovery back to the 38.2% retracement of the most recent phase of the sell-off at 126.71, potentially the 13-day exponential average and price resistance at 1.2697/1.2705, but with sellers expected here if reached.”