FX

GBPUSD faces resistance to further gains

Cable faces resistance to further gains despite touching a year high at 1.7179 last week, say analysts at ADS Securities. A short-term overbought scenario now exists that could see the pound test 1.7000/15. On the upside, a move through the 1.7177 would still see gains limited in the near-term.

Oversold BRL poised for temporary bounce

An oversold Brazilian Real is set for a bounce although the longer-term outlook remains bearish, says George Davis at RBC Capital Markets. Support at 2.1832 and 2.2000 is in place after the major trend reversal below 2.2692 in March but resistance at 2.2646-2.2886 will present selling opportunities.

Major EUR correction has begun

EUR/USD has finally reversed direction and is set for sharp declines, according to Walter Zimmermann at United-ICAP. The currency may find support at the trend line originating from the July 2012 low – around 1.3470 by the end of June. If this line is broken, the minimum target would be 1.2180.

Cable to retest 1.6904 after correction

Following the downward correction in GBP/USD, sterling is set to retest last week’s high at 1.6904, according to Max Knudsen at ADS Securities. Since the rally from March low, any dips have usually attracted buyers meaning that targets for the next rally are 1.6904, and beyond that, 1.6998.