Although it looks like further pullbacks in GBP/USD in the short term, there is strong support around the 1.2545 level.according to Lee Sue Ann, UOB Group Economist, and Quek Ser Leang, Market Strategist.
24 hour view: Our view that GBP/USD would weaken further was incorrect as it rallied as high as 1.2638 before settling at 1.2629 (+0.31%). Despite the advance, there is no significant momentum building, and GBP/USD is unlikely to go much higher. Today, GBP/USD is more likely to trade in a 1.2595/1.2655 range.
Next 1-3 weeks: We hold the same view as yesterday (Sep 4, GBP/USD at 1.2590). As we have highlighted, the risk to GBP/USD appears to have shifted to the downside. However, as bearish momentum is only starting to consolidate, any weakness is likely to be met with solid support at 1.2500 (there is other strong support at 1.2545). As for resistance, if GBP/USD breaks above 1.2680, it would mean that the momentum built up has faded.
Source: Fx Street
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