GBP/USD: Gains through 1.30 to put a renewed push on to 1.31+ on the radar – Scotiabank

GBP/USD rebound stalls just below 1.30 but underlying trend remains bullish, economists at Scotiabank report.

GBP should remain well-supported on dips

Generally high UK interest rates and positive yield spreads over US Treasurys remain a key source of strength for sterling. 

The broadly bullish pattern of short-term trade noted previously – the rounded low which formed in the low 1.28 area – remains valid. Short-term setbacks are not uncommon for these sorts of patterns but are typically resolved positively. 

Bullish trend signals suggest the GBP should remain well-supported on dips. 

Gains through 1.30 put a renewed push on to 1.31+ on the radar. 

Short-term support is 1.2950/55.