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Cable could try and break below the 1.2662 level, allowing a potential visit to the 1.2593/89 band, suggested Karen Jones, Head of FICC Technical Analysis at Commerzbank.

Key Quotes

GBP/USD has sold off to the 2016-2018 support line at 1.2795 this week and we would allow for this to hold the initial test. The market has held 1.2775 3 times and this is seen as the last defence for the 1.2662 August low. Currently we would allow for a very small bounce towards 1.2950/70 ahead of further weakness”.

“Below 1.2662 would trigger further weakness to the 61.8% retracement of the move 2016-2018 and June 2017 low at 1.2593/89″.