In opinion of FX Strategists at UOB Group, Cable’s upside momentum remains well and sound for the time being.
24-hour view: “Our expectation for GBP to ‘move above last month’s peak near 1.4020’ did not materialize as it pulled back from 1.4009. Overbought conditions combined with waning momentum suggest that GBP has moved into a consolidation phase. For today, GBP is likely to trade between 1.3900 and 1.3990.”
Next 1-3 weeks: “Our update from yesterday still stands. As highlighted, the sharp and rapid rise in GBP earlier this week appears to be a bit overdone but is not showing any sign of weakening just yet. GBP could advance further even though the next major resistance at 1.4100 may not come into the picture so soon. On the downside, a breach of 1.3850 (no change in in ‘strong support’ level) would indicate that the current GBP strength has come to an end.”