The pair GBP / USD is now seen moving within 1.3810-1.4020 in the coming weeks, suggest currency strategists at UOB Group.
Key Comments:
24 hour view: “We highlighted yesterday that GBP / USD ‘could retest the 1.3925 / 30’ level. We add that ‘a breakout of this strong resistance is not ruled out, but the 1.3970 level is not expected to enter the scene. Our opinion was correct as GBP / USD rose to 1.3936 before closing near the high at 1.3935 (+ 0.33%). Bullish momentum has improved, although not much. From here, GBP / USD could rise and test 1.3970. A sustained rise above this level is unlikely (next resistance is at 1.4020). On the downside, a breakout of 1.3860 (minor support is at 1.3895) would indicate that the current slight upward pressure has eased. ” .
Next 1-3 weeks: “We have had a negative view on GBP / USD since the end of last week. Yesterday (Mar 10, GBP / USD at 1.3880), we highlighted that ‘the bearish momentum has faded and a breakout of 1.3930 would indicate that the current slight downward pressure on GBP / USD has dissipated’. The British pound broke 1.3930 during the American session (1.3936 high) and the downside risk has dissipated. The current move is seen as the early stages of a consolidation phase and GBP / USD is likely to trade between 1.3810 and 1.4020 for now. “
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