Ella 
24-hour view: After the pound fell to 1.2767 last Friday and rebounded, we emphasized yesterday that “although there is a strong rebound, the momentum has not increased significantly, and the pound is unlikely to rise further.” We expect the pound to consolidate between 1.2810-1.2910. In line with our view, GBP is consolidating but in a tighter range (1.2829/1.2872). Momentum indicators were largely flat, with further consolidation likely. Today’s range is expected to be 1.2795/1.2865.
Outlook for the next 1-3 weeks: Our update remains unchanged since last Friday (28 Jul 1.2800 market). As we have highlighted, “downward momentum is re-established and it remains to be seen whether GBP can break key support at 1.2720.” Overall, as long as it stays below 1.2900 (the previous ‘strong resistance’ level was at 1.2930), GBP will remain bearish bias.
