British Pound: Sustained break above 1.3650 may open 1.41 – Scotiabank
Scotiabank strategists Shaun Osborne and Eric Theoret note that GBP/USD gains into the mid-1.36s are driven more by US Dollar (USD) weakness than intrinsic British Pound (GBP) strength, though United Kingdom (UK) survey data show improving manufacturing orders and pricing power.
Scotiabank strategists Shaun Osborne and Eric Theoret explain that the recent GBP/USD gains to the mid-1.36s are primarily due to US Dollar (USD) weakness rather than intrinsic British Pound (GBP) strength. UK survey data indicates improving manufacturing orders and pricing power. Technically, Cable has met the near-term goal of retesting the May peak.
A sustained move above 1.3650/60 is seen as a potential extension towards 1.41 this year. The August CBI Trends survey revealed significant improvement in weak manufacturing orders and a rebound in industrial pricing power. Bullish trend dynamics remain solid, and a sustained push above 1.3650/60 implies an extension towards the 1.41 zone over the year.
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