The July 2023 high at 1.3140 is a minor block – Scotiabank

Sterling (GBP) is knocking on the door of last year’s spot high around 1.3140 after this morning’s UK August PMI data, notes Shaun Osborne, chief FX strategist at Scotiabank.

Stronger resistance may develop closer to 1.32

“The numbers suggest that the UK economy is in a pretty decent position (growth rising, prices slowing). Manufacturing output (52.5) ​​was above July’s level and better than forecast, hitting the highest in two years. Services and composite data reflected solid gains.”

“GBP has only had one losing day in the last 11 sessions since retracing from the 200-day MA test below 1.27, but the recovery could develop a bit further. Trend strength indicators are bullish on intraday and daily DMIs, but clearly not extended.”

“The July 2023 high at 1.3140 is a minor stop to gains, but stronger resistance may develop closer to 1.32 in the short term. Support is 1.3075.”