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Cable could extend the up move to levels above the 1.2400 handle on a daily close beyond 1.2380, noted FX Strategists at UOB Group.

Key Quotes

24-hour view: “Expectation for “further strength” did not materialize as GBP eased off and closed on a relatively soft note at 1.2288 (-0.36%). The recent strong upward pressure has waned and the current movement is viewed as the early stages of a consolidation phase. In other words, GBP is expected to trade sideways for today, likely between 1.2250 and 1.2330″.

Next 1-3 weeks: “After the strong and rapid rise, a move above 1.2380 would not be surprising. However, the outsized gain over the past three days appears to be running ahead of itself and for now, we have doubts on whether GBP could maintain the pace of its current advance. That said, only a break of 1.2170 (strong support was at 1.2120 yesterday) would indicate the recovery phase has run its course. Looking ahead, if GBP were to close above 1.2380 in NY, it would suggest the recovery could extend to 1.2450, possibly 1.2500″.