A move above 1.3400 remains on the cards amidst the firm momemtun in Cable, suggested FX Strategists at UOB Group.
Key Quotes
24-hour view: “We highlighted yesterday that ‘upward momentum has improved’ and that ‘a break of 1.3400 could lead to further gains towards 1.3440’. Our view did not materialize as GBP rose to a high of 1.3399 before retreating quickly. Upward pressure has more or less dissipated and the current movement is viewed as part of a consolidation phase. Overall, GBP is expected to trade sideways, expected to be within a 1.3315/1.3390 range.”
Next 1-3 weeks: “We have held a positive view in GBP since last Tuesday (17 Nov, spot at 1.3210). After GBP retreated from a high of 1.3396, we highlighted on Tuesday (24 Nov, spot at 1.3325) that ‘there is chance, albeit not a high one, for GBP to push above 1.3400’. GBP rose to 1.3394 yesterday before closing at 1.3386 (+0.19%). Momentum is beginning to improve and a break of 1.3400 would shift the focus to the yearto-date high at 1.3481 (there is a minor resistance at 1.3440). All in, the outlook for GBP is deemed as positive as long as it does not move below 1.3280 (‘strong support’ level previously at 1.3250).”
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