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The GBP/USD pair stays on course for a test of support at 1.3840/30, with the risk now seen for a move to the 55-day average at 1.3710, the Credit Suisse analyst team reports.

Key quotes

“We continue to see scope for a deeper corrective setback yet to price and trend support from early January at 1.3840/30. We continue to look for an attempt to find a floor here, at least at first. The risk for a break through in due course is seen growing steadily which would then warn of a more serious correction lower and a test of 1.3741/31, potentially the 55 -day average at 1.3710, but with fresh buyers expected here.” 

“Resistance is seen at 1.3932 initially, above which can see a move back to 1.3978. Above 1.3998/98 though is now needed to ease the immediate downside bias to mark a minor base, clearing the way for a recovery back to 1.4021/29 initially, then 1.4107.”

 

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