GBP strong but technically bearish - Scotiabank

By FXstreet.com | Updated July 30, 2014 AAA

FXStreet (Guatemala) - Camilla Sutton, CFA, CMT, Chief FX Strategist at Scotiabank noted that Sterling is strong on the back of recent UK labour data, although the technical are painting another story.



Key Quotes:



"Expected weekly range: 1.6723 ‐ 1.6996, range bound favouring upside risk."



"GBP is strong, retracing yesterday’s losses after the UK released strong labour metrics. Job gains climbed to 345k 3m/3m, well above the expected 270k; helping to push the unemployment rate down to 6.6%; however average weekly earnings were disappointing, gaining just 0.7% 3m/yoy. Tomorrow’s speech by Governor Carney at the annual Mansion House dinner is an important risk for GBP; however we are biased for a test of the recent 1.6996 high."



"GBP/USD short‐term technicals: bearish—but momentum is fading as GBP is stuck trading between its 50 and 100-day MA (1.6798 and 1.6692, respectively). There is better risk/reward elsewhere."



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