GBP/USD: Extra gains seen above 1.3710 – UOB

Pablo Piovano FXStreet

Cable could see its upside renewed on a breakout of the 1.3710 level in the next weeks, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “While we expected GBP to strengthen yesterday, we were of the view that ‘1.3700 is unlikely to come into the picture’. However, GBP popped to a high of 1.3720, dropped quickly to 1.3623 before snapping back up. The price actions have resulted in a mixed outlook and for today, GBP is likely to trade between 1.3620 and 1.3720.”

Next 1-3 weeks: “There is not much to add to our update from yesterday (20 Jan, spot at 1.3645). As highlighted, GBP ‘has to close above 1.3710 before a sustained advance can be expected’. GBP subsequent rose to 1.3720 before retreating to close at 1.3660 (+0.18%). While momentum is positive, it appears ‘tentative’ for now and we continue to wait for added confirmation of a daily closing above 1.3710 before expecting a move to 1.3760, possibly 1.3800. On the downside, a break of 1.3580 (‘strong support’ level was at 1.3550 yesterday) would indicate that the upside risk has dissipated.”

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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