Cable’s upside remains firm and now targets the 1.4300 neighbourhood in the next weeks, suggested FX Strategists at UOB Group.
Key Quotes
24-hour view: “After GBP soared during Asian hours yesterday, we noted that ‘while further advance is not ruled out, the rapid rise appears to be overdone and the next major resistance at 1.4300 is unlikely to come into the picture’. However, GBP dropped to 1.4083 before rebounding to end the day at 1.4143 (+0.22%). Upward pressure has waned and GBP is likely to trade sideways for today, expected to be between 1.4070 and 1.4210.”
Next 1-3 weeks: “We have held a positive view in GBP for more than 2 weeks. In our latest update from Monday (22 Feb, spot at 1.4030), we indicated that ‘upward momentum remains strong and GBP could advance further to 1.4100’. We added, ‘a clear break of 1.4100 would shift the focus to 1.4150’. We did not anticipate the sudden surge in GBP as it just breached 1.4150 during Asian hours and the focus has shifted to 1.4300 followed by the 2018 high of 1.4377. On the downside, a break of 1.4020 (‘strong support’ level was at 1.3940 yesterday) would indicate that the positive phase in GBP has run its course.”
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