GBP/USD: View is still negative – UOB Group

Pound Sterling (GBP) could edge lower, but it does not appear to have enough momentum to break below 1.3375. GBP view is still negative; the next technical target at 1.3320 may not come into view so soon, as it could consolidate first, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Not enough momentum to break below 1.3375

24-HOUR VIEW: "We expected GBP to consolidate last Thursday. On Friday, we indicated that 'further consolidation seems likely, even though the firmer underlying tone suggests a higher range of 1.3390/1.3465.' GBP then traded in a higher range of 1.3406/1.3476, closing largely unchanged at 1.3410 (-0.06%). There has been a slight increase in downward momentum. Today, GBP could edge lower, but it does not appear to have enough momentum to break below 1.3375. The major support at 1.3320 is not expected to come into view. Resistance levels are at 1.3440 and 1.3465."

1-3 WEEKS VIEW: "In our most recent narrative from last Wednesday (16 Jul, spot at 1.3395), we stated that 'GBP view is still negative.' However, we indicated that 'the next technical target at 1.3320 may not come into view so soon, as it could consolidate first.' We maintain our view for now. However, if GBP breaks above 1.3490 (with no change in ‘strong resistance’ level from last Friday), it would indicate that the GBP weakness from early this month has stabilised."