GBP/USD points to extra consolidation between 1.37/1.39 – UOB

FX Strategists at UOB Group noted the neutral stance on  Cable and expects further consolidation between 1.37 and 1.39 in the near term.

Key Quotes

24-hour view: “GBP rose strongly to hit a high of 1.3889 last Friday but the up-move was short-lived. Despite the rapid pull-back from the top, the undertone is still positive and there is scope for a retest of the 1.3890 resistance. At this stage, a sustained move above this level is not expected (next resistance is at 1.3930). On the downside, support is at 1.3815 followed by 1.3785”.

Next 1-3 weeks: “GBP rebounded last Friday but overall registered an ‘inside day’. Despite the muted price action, we continue to hold the view that the immediate bias is tilted to the downside but any weakness is viewed as part of a 1.3700/1.3900 consolidation range and not the start of a sustained down-move. An intraday move above 1.3900 is not ruled out but only a clear break of 1.3930 would indicate that the current mild downward pressure has eased”.