Cable is expected to gravitate between 1.3080 and 1.3280 in the next 1-3 weeks, according to FX Strategists at UOB Group.
Key Quotes
24-hour view: “We highlighted yesterday that the up-move in GBP appears to be running ahead of itself but a “test of 1.3220 would not be surprising”. GBP rose to a high of 1.3227 but the up-move was short-lived. Despite the pullback from the high, the undertone has improved even though any advance from here is unlikely to move clearly beyond 1.3255 (1.3230 is already quite a strong resistance). Support is at 1.3180 but the stronger level is at 1.3155”.
Next 1-3 weeks: “GBP slipped to a low of 1.3087 last Friday but rebounded strongly and ended the day on a positive note. While the undertone has weakened somewhat, we continue to hold a neutral view for this pair. The current movement is viewed as part of a consolidation phase even though the immediate bias is for GBP to edge lower and test the bottom of the expected 1.3080/1.3280 consolidation range. At this stage, a sustained move below this level is not expected”.
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