GBP/USD: bulls lack conviction - Scotiabank

Analysts at Scotiabank explained that GBP is quiet consolidating near the mid-point of its two week range, roughly bound between support around 1.2350 and resistance above 1.2650. 

Key Quotes:

"Momentum signals are neutral, DMI’s are muted, and short-term MA’s have flat-lined.

GBP is a relative performer among the G10 with a modest rally into the release of stronger than expected retail sales data.

The lack of a follow-through is notable. Yield spreads remain a drag and the outlook for relative central bank policy should maintain pressure on GBP. 

Positioning provides an important offset as sentiment remains near record bearish levels. GBP vols and risk reversals are steady."