Cable’s outlook remains neutral and is seen testing the vicinity of the 1.3220 area in the next weeks, suggested FX Strategists at UOB Group.
Key Quotes
24-hour view: “GBP registered a range of 1.3034/1.3150 yesterday, relatively close to our expected 1.3040/1.3140 consolidation range. The subsequent strong daily closing in NY (1.3146, +0.41%) suggests the current GBP strength could extend higher from here. However, at this stage, we do not anticipate a clear break of the major 1.3220 resistance (minor resistance is at 1.3195). On the downside, 1.3085 is likely strong enough to hold any pull-back (minor support is at 1.3115)”.
Next 1-3 week: “We have held the same view since Monday (08 Oct, spot at 1.3120) wherein we expect GBP to trade with an upside bias and probe the top of the anticipated 1.3030/1.3220 consolidation range. However, GBP tested the bottom of the range twice as it touched 1.3029 during London hours on Monday and 1.3034 yesterday (09 Oct). The strong bounce from the support level suggests that 1.3030 is likely strong enough to hold, at least for several more days. From here, the pressure has shifted to the upside and we expect GBP to test 1.3220 within these few days. At this stage, the prospect for a sustained break above this level is not high (the next resistance is at 1.3255 ahead of last month’s 1.3295 top)”.
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