In the opinion of the currency strategists at UOB Group, the GBP / USD is now seen moving within the 1.3600-1.3830 range in the short term.
24 hour view: “We saw yesterday that GBP / USD is unlikely to ‘weaken further’ and we expected GBP / USD to ‘consolidate and trade between 1.3585 and 1.3670’. Our consolidation view was wrong as GBP / USD turned down to 1.3591 before making a surprisingly strong bounce (the high was 1.3723 during the last few hours in New York). The fast bounce seems to be getting ahead of itself, but there is room for GBP / USD to move higher towards 1.3750 first. before a pullback can be expected. Next resistance at 1.3780 is not expected to enter the scene. Support is at 1.3670, but only a breakout of 1.3635 would indicate that current upward pressure has eased. “
Next 1-3 weeks: “We highlighted yesterday that there is room for GBP / USD to fall below 1.3550. We add: ‘In view of oversold conditions, it remains to be seen if it can sustain a support point below this level.’ We did not expect the strong rebound to a high of 1.3723. While our “strong resistance” level at 1.3730 remains intact, the rapid loss of momentum suggests that the possibility of GBP / USD moving below 1.3550 has dissipated. from here, GBP / USD is expected to consolidate and move within a relatively wide range of 1.3600 / 1.3830. “