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Technical, Macro Backdrop Remains Bearish

GBP
  • The post-Powell greenback strength being acutely felt in GBP/USD heading through the London close, with the pair wholly reversing the day's brief rally (which topped out at 1.1901) and being compounded by the firmer EUR which puts EUR/GBP at 0.85.
  • The technical backdrop as well as looming energy cost crunch news (BBG write that a large house could see energy bills of £10,000 per year) keeps the outlook bearish after recent weakness resulted in the break of support at 1.1760, the Jul 14 low and bear trigger.
  • Price action has confirmed a resumption of the broader downtrend and paves the way for a move towards 1.1673, the 1.00 proj of the May 27 - Jun 14 - 16 price swing.

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