Now GBP / USD is expected to move within the 1.4080-1.4220 range in the coming weeks, say UOB Group currency strategists.
24 hour view: “We expected GBP / USD to ‘fall below main support at 1.4100’ yesterday, but we are of the opinion that ‘it seems unlikely that it will break last week’s low near 1.4080’. However, the British pound fell to 1.4074 before making a surprisingly strong and sharp rally to 1.4178 during the final hours of the American session. The bounce has room to extend, but a clear breakout of the main resistance at 1.4220 would be a surprise (1.4195 is already quite a strong level). Support is at 1.4145 followed by 1.4120 “.
Next 1-3 weeks: “We highlighted yesterday (June 10, GBP / USD at 1.4155) that ‘short-term bearish momentum is starting to improve’, but we are of the opinion that GBP / USD ‘has to close below 1.4080 before a decline can occur. sustained expected ‘. We add, ‘the outlook for the British pound to close below 1.4080 is not high, but would rise further as long as it does not move above 1.4185’. Thereafter, GBP / USD briefly fell to 1.4074 before rebounding strongly. While 1.4185 is still intact (high of 1.4178 in the American session), the short-term momentum buildup has faded. In other words, GBP / USD does not seem poised to move lower in a sustained manner. From here, the pair is more likely to trade within a relatively wide range of 1.4080 / 1.4220 “.