GBP/USD: Strong support area in the 1.30 - 1.28 region - Lloyds  Bank

Analysts from Lloyds Bank points out that the GBP/USD pair continues to trade in ranges and explain that only a break above 1.3850 - 1.4050 would suggest a base is in place.

Key Quotes:

 “We remain trapped in a range between 1.31 and 1.35 since the referendum outcome. We expect further range trading today. Overall the current price action is seen as a consolidation ahead of a test of stronger support in the 1.30-1.28 region.”

“A stronger correction through 1.35 sees resistance at 1.3610 and then 1.3800-1.3850. However, at this stage only a rally up through the 1.3850-1.4050 region would suggest a more significant base is in place.”

“Long term the drop through 1.35 is the last phase in the bear trend that started from the 2007 highs at 2.1160. A base is expected to take time to develop, rather than being a V-shape with 1.28 already highlighted as important support and the 1.20 region below there.”