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The upside momentum in GBP/USD could now extend to the mid-1.2600s, according to FX Strategists at UOB Group.

Key Quotes

24-hour view: “We highlighted the robust upward momentum yesterday and expected GBP to strengthen but we held the view that ‘the major 1.2600 resistance is likely out of reach’. While our view was not wrong as GBP eased from a high of 1.2575, GBP opened on a firm note this morning and moved above 1.2575. From here, GBP could advance further even though a sustained rise above the major 1.2650 resistance is unlikely for today. Support is at 1.2540 followed by 1.2500.”

Next 1-3 weeks: “We just adopted a positive GBP outlook yesterday (02 Jun, spot at 1.2500) and expected GBP to ‘move higher towards 1.2600’. There is no change to our view and once above 1.2600, the April’s peak near 1.2648 could come into the picture quickly (next resistance is at 1.2700). After the strong advance yesterday, the ‘strong support’ level has moved higher to 1.2460 from yesterday’s level of 1.2360.”