The GBP’s loss of the 1.34 handle is weighing on the cable toward a test of the mid-figure area. Economists at Scotiabank note that the pair could suffer a substantial drop to the 1.32 support zone.

GBP/USD price action points to more downside ahead

“With the pound showing limited signs of a break past the mid 1.34s, price action points to more downside ahead while it builds a wide ~1.3275-1.3435 trading band over the past five sessions.” 

“Support after the mid-1.33s is the big figure and once the 1.3270/75 zone breaks, the GBP is looking at a quick decline to the 1.32 support area.”

“Intermediate resistance is ~1.3420 after the figure, followed by the mid 1.34s.”