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Cable is still expected to navigate the 1.2850-1.3030 range in the next weeks, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “While we noted yesterday that the ‘swift advance appears to be running ahead of itself’, we were of the view that ‘there is room for GBP to probe 1.3030’. Our expectation was incorrect as GBP slumped from 1.3008 and touched an overnight low of 1.2896. The rapid swing has resulted in a mixed outlook. That said, the rapid pull-back could extend lower but last week’s low near 1.2850 is not likely to come into the picture (minor support is at 1.2875). Resistance is at 1.2945 followed by 1.2980. The 1.3008 high is expected to be ‘safe’ for today.”

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.”