GBP/USD traded to a new cycle low just under 1.2040 in early European trade but gained a cent from the intraday low. Economists at Scotiabank analyze the pair’s outlook.

Technicals lean bullish

Intraday and daily price signals are bullish for a heavily oversold GBP.

The six-hour and daily charts reflect solid demand for the GBP off the early session low today which has formed a bullish outside range on the intraday chart and the makings of a similar signal on the daily chart (a higher net close on the session – the higher the better, from a signal clarity point of view – confirms).