In view of FX Strategists at UOB Group, Cable is seen declining and testing the lower bound of the 1.3080/1.3170 band in the next weeks.
24-hour view: “The anticipated GBP strength exceeded our expectation as it moved above the strong resistance indicated at 1.3155 yesterday and touched a high of 1.3176. Despite the up-move, there is no significant improvement in upward momentum and we do not expect further GBP strength for today. GBP is more likely to trade sideways even though the immediate bias is for it to probe the bottom of the expected 1.3080/1.3170 consolidation range”.
Next 1-3 weeks: “There is not much to add to yesterday’s (07 Nov, spot at 1.3100) update. As highlighted, the recent rebound in GBP could extend further but at this stage, a break above the major 1.3190 resistance would come as a surprise. On the downside, only a move below the ‘key support’ at 1.3000 (level was at 1.2950 yesterday) would indicate that a short-term top is in place. Looking ahead, even there is a break above 1.3190; we see another strong resistance at 1.3220 ahead of the October’s peak of 1.3259”.
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