The outlook for cable pretty much mirrors a lot of what we see in EUR/USD and with the dollar running hot again in the past week, it is hard to fight the momentum when the pound itself has so little going for it at the moment. When looking at the pair, I maintain the view from last week here:
"Considering that both central banks (Fed and BOE) already gave a formal message that we are in the second-half of the tightening cycle, the trade for cable is very much a case of 'who folds first'? The Fed or the BOE? In this instance, it looks very much like the latter.
As such, the path of least resistance is for the pair to move lower - all else being equal. Now, with the dollar picking up steam across the board, the next test is 1.1800 and the year's low at 1.1759."
If we do see a firm break below 1.1800, it will open up the path towards a sharper drop in the pair with the March 2020 lows at around 1.1410 to 1.1500. Given that things are lining up well for the dollar right now, it's hard to rule out such an extended fall.