GBP/USD reluctant to break the key 1.3060 support - Lloyds

Analysts from Lloyds Bank, continue to see a potential head and shoulders formation in the GBP/USD pair.

Key Quotes:

“Despite the upbeat tone in yesterday’s FOMC statement, GBPUSD spiked to a new week-to-date high near 1.3250, before retreating after a YouGov survey suggested UK consumer confidence was at a 6-year low.”

“The pair had been reluctant to break the important 1.3060 support level, and while above here, price action can be considered consistent with the development of a potential head and shoulders base - a rally through 1.3315 is needed to increase conviction on this view. A break below 1.3060 would initially open up 1.2945 Fib support and potentially expose the range lows at 1.2798.”

“Long term, the decline through the 2009 lows at 1.35 is viewed as the last phase in the bear trend that started back in 2007 from the 2.1160 highs. We favour a multi-month bottoming process.”