GBP/USD: Loss of 1.2540 should ease bullish pressure – UOB

In the opinion of Lee Sue Ann, an economist at UOB Group, and Quek Ser Leang, a market strategist, a possible test of 1.2720 in GBP/USD could lose steam if 1.2540 level is broken.

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24 hour view: “We highlighted yesterday that “although bullish momentum has waned a bit, there is room for GBP/USD to test 1.2665 before the risk of a reversal increases.” And we added: “The next resistance at 1.2720 is not expected to be seen.” Threatened”. Our view was correct as GBP/USD rallied as high as 1.2668 and then pulled back. The pullback could continue, but we believe that any decline would be in the lower range of 1.2575-1.2655. In other words, it is unlikely that the GBP/USD falls below 1.2575 on a sustained basis.”

Next 1-3 weeks: “Last Friday (May 5, GBP/USD at 1.2575), we highlighted that GBP/USD “probably rises towards the main resistance of 1.2665.” Yesterday (May 8, GBP/USD at 1.2630), we indicated that “the Bullish momentum is picking up and GBP/USD could break above 1.2665” and “next resistance above 1.2665 is at 1.2720”. GBP/USD reached a high of 1.2668 during the London session before pulling back. Conditions Short-term overbought signs suggest GBP/USD could stay below 1.2668 for a day or 2. In general, only a break of 1.2540 (no change from yesterday’s “strong support” level) would indicate 1.2720 is out out of reach this time.”