GBP/USD tested 2013 lows
GBP/USD had made an early attempt to move higher to $1.4980 before being pulled down to $1.4830 (2013 lows). Cable dropped on downbeat figures, showing that the UK manufacturing production fell by 0.8% in May (forecast: 0.3%, previous: -0.2%). UK trade deficit remained almost stable at 8.5B.
The pair is currently trading a bit higher around $1.4865. A daily close below $1.4865 (recent lows) would be a bearish signal. Break below the $1.4830 support opens the way for a further slide towards the $1.4230 area (2010 lows). We remain clearly bearish for the pair as long as the $1.5000 resistance holds.
Rabobank: From a technical perspective a break below here would increase the chances of another leg down towards $1.4250. However, we doubt if there is currently the appetite in the market to trigger a sharp move lower in cable from current levels. That’s why we currently favor buying the cable on dips.
Chart. Daily GBP/USD