GBP/USD bulls are lining up - Scotiabank

By FXstreet.com | Updated July 30, 2014 AAA

FXStreet (Guatemala) - Camilla Sutton, CFA, CMT, Chief FX Strategist at Scotiabank said that the expected weekly range for GBP/USD is 1.6723 ‐ 1.6996, range bound favouring upside risk.



Key Quotes



"Governor Carney was clear and concise when he commented that interest rate hikes “could happen sooner than markets currently expect”."



"The market had between pricing in one interest rate hike in the next 12‐months and this has jumped to an 80% chance of two hikes. However, Governor Carney was quick to warn that the timing of the first rate hike is less important than the path thereafter and that this path is likely to be gradual and limited."



"For GBP this suggest near‐term upside risk against USD, EUR and JPY; but then a stabilization (in line with our current forecast pattern). In the near‐term support lies at yesterday’s close of 1.6926 followed by the 50‐day MA at 1.6812; while resistance comes in at the ytd high of 1.6696 (see chart). We expect GBP to rally above 1.70 in the near‐term."



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