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FX Strategists at UOB Group noted that a move above 1.3070 should leave the mid-1.2800s as an interim low in Cable.

Key Quotes

24-hour view: “The rapid improvement in upward momentum that sent GBP to high of 1.3018 was unexpected. The swift advance appears to be running ahead of itself but there is room for GBP to probe the 1.3030 resistance. For today, a rise beyond 1.3070 is not expected. On the downside, a breach of 1.2950 (minor support at 1.2980) would indicate the current upward pressure has eased.”

Next 1-3 weeks: “We highlighted on Monday (24 Feb, spot at 1.2950) that an “interim bottom is in place” and expected GBP to ‘trade sideways between 1.2850 and 1.3030’. While GBP is approaching the top of the expected range at 1.3030, there is no marked improvement in momentum. That said, a move above 1.3030 is not ruled out but only a clear break of 1.3070 would indicate that last week’s low at 1.2849 could hold for longer than expected.”