According to economist Lee Sue Ann and market strategist Quek Ser Leang of UOB Group, the bullish bias could lose traction if GBP/USD breaks below 1.2350.
24-hour outlook: Yesterday we indicated that GBP/USD “appears to have entered a consolidation phase”, and maintained the view that it “is likely to trade in a range of 1.2380/1.2480”. Subsequently, GBP/USD fell to 1.2377, bounced to 1.2455 and then declined to close virtually unchanged at 1.2415 (+0.01%). Price movements still appear to be consolidating, and we continue to expect GBP/USD to trade in a range, probably between 1.2375 and 1.2460.
Next 1-3 weeks: Our last story was from two days ago (November 15, GBP/USD at 1.2490), where GBP/USD “is likely to continue advancing, but has to break clearly above 1.2580 before a further sustained rise is likely.” “. Since then, GBP/USD has not been able to advance higher, having retreated in the last two days. Although the bullish momentum has waned somewhat, only a break of 1.2350 (no change to yesterday’s “strong support” level) would indicate that GBP/USD is not advancing any further.
Source: Fx Street
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