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FX Strategists at UOB Group noted Cable could trade within the 1.3460-1.3710 range in the next weeks.

Key Quotes

24-hour view: “Yesterday, we held the view that GBP ‘could move above the major resistance at 1.3700 but a sustained rise above this level is unlikely’. GBP subsequently rose to a high of 1.3703 before staging a surprisingly sharp and swift sell-off (overnight low of 1.3544). The rapid drop appears to be running ahead of itself but it is not showing sign of stabilization just yet. The risk is on the downside but for now, any weakness is viewed as part of a 1.3500/1.3620 range. In other words, a sustained decline below 1.3500 is unlikely.”

Next 1-3 weeks: “GBP edged above 1.3700 yesterday (high of 1.3703) before staging a surprisingly sharp sell-off. The breach of the ’strong support’ at 1.3560 (overnight low of 1.3544) has invalidated our view for GBP to advance towards 1.3750. Upward pressure has eased and the current movement is viewed as part of consolidation phase and GBP could trade between 1.3460 and 1.3710 for a period of time.”