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Following the recent move up, Cable could now attempt a test of 1.3285, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “We held the view last Friday that ‘there is room for GBP to test 1.3125’. While our view for GBP to strengthen was not wrong, the subsequent strong surge to a high of 1.3210 came as a surprise. While overbought, the rally still appears to be robust and GBP could edge above 1.3210 from here. That said, the next resistance at 1.3250 is likely out of reach. Support is at 1.3140 followed by 1.3110.”

Next 1-3 weeks: “After trading in an undecided manner for several days, GBP staged a strong 2-day back-to-back gain last Thursday and Friday and edged above the top of our expected sideway-trading range of 1.2900/1.3200 (high of 1.3210 last Friday). Despite the rapid rise, upward momentum has not improved by as much. However, the risk has shifted to the upside towards the late December peak near 1.3285. On the downside, only a move below 1.3050 (‘strong support’ level) would indicate the current upward pressure has eased.”