FXStreet (Edinburgh) - The sterling continues to deflate on Tuesday, now dragging the GBP/USD to the mid-1.6900s, levels last seen in late June.
GBP/USD in multi-week lows
Spot resumed its recent decline after a failed attempt to clinch the 1.70 handle and beyond post-UK data earlier on today. The pair broke below 1.6950 as the sentiment regarding a sooner-than-expected rate hike by the BoE failed to gather further steam as of late. In the same direction, the recent appreciations by IMF’s Largarde regarding an ‘overvalued’ pound will be playing its role in the current weakness. Eric Theoret, Currency Strategist at Scotiabank, commented that short-term technicals look bearish, adding, “trend, momentum indicators are bearish, underscored by a break below the 50-day MA at 1.6973. A decline below 1.6920 should provide for further downside, as we look to the June 12 open 1.6788”.
GBP/USD levels to watch
At the moment the pair is down 0.20% at 1.6945 and a break below 1.6920 (low Jun.18) would aim for 1.6900 (psychological level). On the flip side, the initial resistance aligns at 1.6994 (high Jul.29) ahead of 1.7001 (high Jul.28).