Weakness has not stabilized. The Pound Sterling (GBP) could dip to 1.3080 before stabilisation can be expected. In the longer run, price action suggests further GBP weakness; the next major support at 1.3000 may not come into view so soon, UOB Group FX analysts Quek Ser Leang and Lee Sue Ann note.

The next major support is at 1.3000

24-HOUR VIEW: “While we expected GBP to weaken yesterday, we were of the view that ‘the major support 1.3210 level is unlikely to come under threat.’ However, GBP not only broke below 1.3210 but also plunged further, reaching a low of 1.3093. Not surprisingly, after such an outsized decline, conditions are severely oversold, but given that the weakness has not stabilised, GBP could dip to 1.3080 before stabilisation can be expected. The major support at 1.3000 is not expected to come into view. Resistance levels are at 1.3160 and 1.3200.”