GBP/USD: Likely to trade in a range between 1.3290 and 1.3365 – UOB Group

FXStreet Insights Team FXStreet

Pound Sterling (GBP) is likely to trade in a range between 1.3290 and 1.3365. In the longer run, downward momentum has slowed somewhat, but there is still a chance for GBP to decline to 1.3200, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Downward momentum has slowed somewhat

24-HOUR VIEW: "The following are excerpts from our update yesterday: 'Despite the relatively quiet price movements, there has been a slight increase in downward momentum. Today, GBP may edge lower, but any decline is likely part of a lower range of 1.3295/1.3350. To put it another way, GBP does not appear to have enough momentum to break below 1.3295.' We did not expect the downward momentum to accelerate quickly, as GBP plunged to a low of 1.3249. GBP rebounded from the low and closed slightly lower by 0.12% at 1.3320. The rebound from oversold conditions suggests that instead of continuing to decline, GBP is more likely to trade in a range today, expected to be between 1.3290 and 1.3365."

1-3 WEEKS VIEW: "On Monday (13 Oct, spot at 1.3350), we highlighted that while downward momentum has slowed with the recent recovery, 'there is still a chance for GBP to decline to 1.3200.' While GBP dropped to a low of 1.3249 yesterday, it rebounded strongly from the low. There has been no improvement in downward momentum, and we continue to hold the same view for now. Overall, only a breach of 1.3390 (no change in ‘strong resistance’ level) would suggest that the weakness in GBP that started in the middle of last week has stabilised."

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD drops to daily lows near 1.1630

EUR/USD now loses some traction and slips back to the area of daily lows around 1.1630 on the back of a mild bounce in the US Dollar. Fresh US data, including the September PCE inflation numbers and the latest read on December consumer sentiment, didn’t really move the needle, so the pair is still on course to finish the week with a respectable gain.

GBP/USD trims gains, recedes toward 1.3320

GBP/USD is struggling to keep its daily advance, coming under fresh pressure and retreating to the 1.3320 zone following a mild bullish attempt in the Greenback. Even though US consumer sentiment surprised to the upside, the US Dollar isn’t getting much love, as traders are far more interested in what the Fed will say next week.

Gold makes a U-turn, back to $4,200

Gold is now losing the grip and receding to the key $4,200 region per troy ounce following some signs of life in the Greenback and a marked bounce in US Treasury yields across the board. The positive outlook for the precious metal, however, remains underpinned by steady bets for extra easing by the Fed.