Here’s an interesting observation from Citi. The analysts have noticed the peculiar dynamics of GBP/USD.
In 1992 the pair fell from levels above $2.0000 to the $1.4500 area and then was rising to $1.7178 for 68 months. In 2000 pound collapsed from just over $2.0000 the $1.3500 area and then was rising to $1.7191 for 66 months.
According to Citi, if GBP/USD follows this pattern, it may make a squeeze higher, potentially towards $1.6960, over the coming few weeks before the next leg lower begins: “A continuation of the pattern seen in the late 1990s suggests that this is only the start of the decline in GBPUSD. However, focusing in on the October 1998 turn, we see even more similarities which suggest we can see a squeeze higher before the next leg lower begins.”