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In light of the recent price action, Cable is now expected to remain side-lined in the next weeks, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “Our expectation for GBP ‘to retest last Friday’s 1.2980 peak’ was incorrect as it dropped to a low of 1.2887 before rebounding quickly. The price action is deemed as a consolidation phase and GBP is expected to trade sideways for now, likely between 1.2885 and 1.2960.”

Next 1-3 weeks: “The downward pressure that last Thursday (20 Feb, spot at 1.2920) ended abruptly as GBP rebounded above the ‘strong resistance’ level of 1.2960 (high of 1.2980). For now, last week’s 1.2849 low is viewed as an interim bottom and the current price action is likely part of a consolidation phase. In other words, GBP is expected to trade sideways between 1.2850 and 1.3030.”