GBP/USD focused on 1.22 on a close below 1.2797/50 – Commerzbank

Karen Jones, Head of FICC Technical Analysis Research at Commerzbank, suggested Cable could shift their attention to 1.22 on a close below the 1.2797/50 band.

Key Quotes

“GBP/USD has eroded the base of a symmetrical triangle at 1.2929 and attention has reverted to the 1.2797/50 July low and the long term Fibonacci support. A close below here will be regarded as very negative and target circa 1.22 (this is the approximate measurement down from the symmetrical triangle pattern…)”.

“We have a near term resistance line at 1.3002 (nearby high is 1.3056) and will consider that the market remains directly offered below here. We view the September high at 1.3443 as an interim high. Only if it and the late June high at 1.3534 were to be overcome would we neutralize our medium term negative outlook”.