GBP/USD: spot may trade 1.40/1.42 for now - Scotiabank

Analysts at Scotiabank explained that the positive run in the pound since the start of the year may flatter to deceive.

Key Quotes:

"There are still risks around the outlook and the recent focus on PM May’s leadership (and the risk of another leadership tussle if the Conservatives do not perform well in the May local elections) suggest to us that the risk of some moderation in the pound recent gains is a risk. Secondary data released overnight showed a rise in the Lloyds “Business Barometer” while the BRC’s “Shop Price Index” suggests softer retail price trends, falling 0.5% Y/Y."

"Trend momentum is neutral intraday but positive on the "longer run studies; spot may trade 1.40/1.42 for now and needs to regain 1.42+ to retest resistance around the 1.44 zone."