GBP/USD a recovery remains on the cards – Commerzbank

In opinion of Karen Jones, Head of FICC Technical Analysis at Commerzbank, Cable still faces the probability of a recovery in the near term.

Key Quotes

“GBP/USD is attempting to stabilise above 1.30 and the market has eroded the 20 day ma at 1.3177. This has neutralised the immediate outlook and suggests some scope for near term recovery. Above here we have 1.3534, the 29th June high and 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”.