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Cable should break above the ley 1.30 handle in order to allow for extra gains to probably 1.3150, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “Our view for GBP to trade in a “lower trading range” was incorrect as it surged and took out the major 1.3000 level (high of 1.3012). The rally appears to be over-extended and while a retest of 1.3010/15 level is not ruled out, the next resistance at 1.3050 is likely out of reach. Support is at 1.2920 followed by 1.2880″.

Next 1-3 weeks: “There is no change to our view from yesterday (21 Oct, spot at 1.2880) wherein “GBP has to ‘punch’ above 1.3000 and register a NY closing above this level in order to indicate that the current rally has enough ‘ammunitions’ to extend to 1.3050, possibly as high as 1.3150″. GBP subsequently rose to 1.3012 but was unable to maintain a toehold above 1.3000 (NY close of 1.2958). That said, further GBP strength is not ruled out and only a break of 1.2770 (‘strong support’ level was at 1.2700 yesterday) would indicate that the positive phase that started more than a week ago has run its course”.