Ella 
24-hour view: Yesterday we believed that the pound “may fall below 1.2780, but may not be able to sustain it.” Contrary to falling below 1.2780, the pound rebounded strongly and recorded its first rise in 7 days (1.2901, +0.59%). GBP may rebound further to 1.2950 today, but is unlikely to hit the important resistance at 1.3000. Support is at 1.2865, then at 1.2835.
Next 1-3 weeks: We have been bearish on GBP since the middle of last week. Yesterday (July 25th market price 1.2815), we pointed out that the downside momentum has strengthened slightly. We noted that “for GBP to fall further, it must break and sustain below 1.2780.” GBP did not break that level, instead it rallied to a high of 1.2905. A break above our ‘strong resistance’ level at 1.2900 suggests that downside pressure has subsided. From here, we expect GBP to be likely to trade between 1.2800-1.3100.
