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Cable is now forecasted to navigate within the 1.2750-1.3000 range in the next weeks, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “GBP soared to a high of 1.2930 yesterday before easing off to close on a strong note at 1.2833. While the rally appears to be overdone, GBP could retest the 1.2930 level before a more sustained pull-back can be expected. For today, the next resistance at 1.2970 is unlikely to come into the picture. Support is at 1.2835 followed by 1.2800.”

Next 1-3 weeks: “Last Friday (25 Sep, spot at 1.2755), we indicated that ‘shorter-term momentum is beginning to ease and this could lead to a couple of days of consolidation first’. We added, ‘as long the ‘key resistance’ at 1.2830 is not taken out, another down-leg towards 1.2650 is still a distinct possibility’. However, GBP blew past 1.2830 as it soared to an overnight high of 1.2930. The break of the ‘strong resistance’ indicated that the negative phase in GBP that started last Tuesday (22 Sep, spot at1.2820) ended sooner than expected (we were expecting another leg lower to 1.2650). The current movement is viewed as the early stages of a consolidation phase and GBP could trade between 1.2750 and 1.3000 for now.”