GBP/USD: A top sees the risk turn lower with support at 1.2912/02 – Credit Suisse

GBP/USD has seen an aggressive fall after confirming a top as expected below 1.3054 to mark a more important turn lower. Analysts at Credit Suisse see support initially at the 55-day average at 1.2912/02, then the potential uptrend from March at 1.2857.

Key quotes

“GBP/USD has extended its rejection from just ahead of the key high of 2019 at 1.3514 for a break as suspected below key price and “neckline” support at 1.3078/54 and this sees a top confirmed to mark a more important turn lower, reinforced by the completion of an RSI momentum top also and DeMark exhaustion signals.” 

“We see support next at the 55-day average 1.2912/02, which we would look to hold at first for a rebound. We look for this to be followed by a break in due course though with support then seen next at the potential uptrend from March at 1.2857, then the June high at 1.2813.”

“Bigger picture, we see scope for a test of a cluster of supports in the 1.2740/1.2691 zone, which includes the 200 - day average and 38.2% retracement of the entire March/September rally. We note though the ‘measured top objective’ is seen set lower at 1.2655.” 

“Immediate resistance is seen at 1.2996, then 1.3010, which we look to try and cap. Above can see a move back to the ‘neckline’ to the top at 1.3054/82.”