GBP/USD is trading little changed on the session but has lost a cent or so from yesterday’s peak. Economists at Scotiabank expect the pair to suffer a susbtantial drop to 1.1860 on failure to hold the above the low-1.19s.

Technical undertone for GBP/USD is bearish

“The GBP is tracking a little softer on the short-term charts and the technical undertone for GBP/USD is bearish. But the Pound is still trading above recent lows and key (longer term) support defined by the convergence of the 100 and 200-day MA signals at 1.1930/35.” 

“Scope for GBP gains is limited (firm resistance at 1.2140/50 now) and loss of support in the low 1.19s will target a quick drop to major support at 1.1860 (Jan low).”