GBP/USD remains vulnerable to the 1.20/1.21 area – ING

GBP/USD extended its decline and came within a touching distance of 1.2100 on Wednesday. Economists at ING analyze Sterling’s outlook.

Caught in the crossfire

Sterling has probably been caught in the crossfire of position adjustment. Speculators had been trying to hold onto long Euro and Sterling positions through the spring, despite the strengthening Dollar. Presumably, these positions have now been cut. 

Like EUR/USD, the GBP/USD pair remains vulnerable to the 1.20/1.21 area.

See: GBP/USD could consolidate back above 1.27 by year-end – ANZ