Here is JP Morgan technical analysts on GBP/USD (I posted earlier on their euro views, here: Technical Analysis – EUR/USD, EUR/CHF and EUR/JPY
- The British Pound is expected to be caught in broader ranges over the course of the next weeks
- The impulsive decline from 1.7192 (July high) in Cable suggests that we have at least launched a much broader AB-C down-consolidation which is ultimately going to test 1.6394 (int. 38.2 %) and 1.6165 (weekly breakout line).
- Whether the wave A or wave 1 low is already in place is however not clear as only a break above 1.6692/1.6738 (200 DMA/minor 38.2 %) would suggest so. Above the latter we’d expect a stronger recovery (wave B or 2) to 1.7018/32 (daily trend/minor 76.4 %) where a good risk-reward selling opportunity would be given again. Below 1.6738 though, the odds remain in favor of a straight exte nsion to 1.6394.
- Deeper GBP setbacks to internal 38.2 % retracements at 153.77 and at 1.7360 are also looming in GBP/JPY and in GBP/CAD, but in order to receive the final confirmation for such sell-offs it takes breaks below 168.87 (weekly trend) in GBP/JPY and below key-pivotal support at 1.7958 in GBP/CAD.
- As for EUR/GBP we still see room for a temporary bounce to 0.8075 if not to 0.8216 (int. 38.2 % on 2 scales) within an intact downtrend towards 0.7755/44 (2012 low/50 %), as long as minor support at 0.7914/11 (pivot/minor 76.4 %) is defended.
GBP/USD– Daily Chart: Below 1.6738, the odds remain in favor of a straight extension to 1.6394
