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GBP/USD now looks to test 1.1680 – UOB

UOB Group currency strategists Quek Ser Leang and Peter Chia noted that the GBP/USD could return to the 1.1680 zone in the coming weeks.

24 hour outlook: “Yesterday we highlighted that the pound could fall further, but a sustained decline below the July low near 1.1760 seems unlikely for now. GBP subsequently fell as low as 1.1744 before closing at 1.1768 (-0.55%). bearish momentum has subsided a bit and although it could drop below the main support at 1.1730, it is unlikely to hold below this level. The next support is at 1.1680. Resistance is at 1.1795, followed by 1.1825″.

Next 1-3 weeks: “Yesterday (Aug 22, pair at 1.1825), we highlighted that the pace of any further decline in the pound was likely to slow down and 1.1730 was expected to offer solid support. We did not anticipate the subsequent sharp decline as GBP closed lower for the fourth day in a row (1.1768, -0.55%).Despite the decline, bearish momentum hasn’t improved much.That being said, there is room for GBP to drop towards 1.1680. Resistance is at 1.1825, but only a break of 1.1875 (‘strong resistance’ level was 1.1935 yesterday) would indicate that the current weakness has stabilised.”

Source: Fx Street

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