According to Lee Sue Ann and Quek Ser Leang, forex strategists at UOB Group, GBP/USD’s bullish momentum should hit a tough snag around 1.2400 in the short term.
24 hour outlook: “GBP rose yesterday to a high of 1.2329 before closing firmly at 1.2321, up 0.51%. upside pressure is starting to build and the pound could extend its gains from here. That said, the major resistance at 1.2400 is not expected to come into the picture (1.2370 is already a pretty strong resistance level). Support is at 1.2300 followed by 1.2270″.
Next 1-3 weeks: “GBP fell as low as 1.2156 last Friday before rebounding sharply. The recent phase of weakness has come to an end and there is room for the current bounce to extend. However, any advance is expected to face stiff resistance at 1.2400. To the downside, a break of 1.2220 would indicate that the build up of bullish pressure has subsided.”
Source: Fx Street
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