In the view of economists at Scotiabank, the GBP/USD pair is set to move back lower and test the 1.22 area.

Losses through 1.22 to trigger a more serious correction

“Short-term price action suggests some scope for a USD rebound against the GBP. 

“Intraday price signals reflect a bearish development in the form of a bearish ‘evening star’-like pattern. Trend momentum signals are leaning strongly GBP-bullish at present, however, which suggests the Pound should remain well-supported on dips. But Cable could dip back to the low 1.22 zone intraday.” 

“Losses through 1.22 could suggest a more serious correction is developing (towards 1.20).”