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Further gains in Cable are seen on a close beyond the 1.4235 level in the near-term, noted FX Strategists at UOB Group.

Key Quotes

24-hour view: “GBP traded between 1.4165 and 1.4219 yesterday, narrower than our consolidation range of 1.4150/1.4220. Upward momentum is beginning to build and there is scope for GBP to rise above the major resistance at 1.4235. For today, the next resistance at 1.4265 is unlikely to come into the picture. On the downside, a break of 1.4180 (minor support is at 1.4200) would indicate that the current mild upward pressure has eased.”

Next 1-3 weeks: “We continue to hold the same view as from last Friday (28 May, spot at 1.4200). As highlighted, GBP ‘has to close above 1.4235 before a sustained advance can be expected’. Shorter-term momentum is beginning to build and the prospect for GBP to close above 1.4235 is relatively high. Looking ahead, the next resistance levels above 1.4235 are at 1.4265 and 1.4290. The potential for GBP to strengthen is deemed intact as long as it does not break the ‘strong support’ at 1.4140 (level previously at 1.4110).”