In opinion of FX Strategists at UOB Group, Cable could advance to the 1.4235 level while above 1.4160 in the next weeks.
Key Quotes
24-hour view: “Our expectation for GBP to ‘trade with a downward bias’ was wrong as it soared to 1.4146 before closing on a firm note at 1.4139 (+0.29%). Upward momentum has improved and GBP could break last week’s high at 1.4167. For today, the next resistance at 1.4200 is likely out of reach. Support is at 1.4115 followed by 1.4095.”
Next 1-3weeks: “We continue to hold the same as from yesterday (17 May, spot at 1.4085). As highlighted, GBP has to move and stay above 1.4160 or the prospect for GBP to move to the next major resistance at 1.4235 would diminish quickly. GBP subsequently rose to 1.4146 before closing at 1.4139. Upward momentum has picked up again but GBP has to close above 1.4160 before a sustained advance can be expected. Conversely, a breach of 1.4050 (‘strong support’ level was at 1.4000 yesterday) would indicate that the GBP strength that started early last week has run its course.”
