In the opinion of the currency strategists of UOB Group, the pound remains ready to extend the upward movement on the short-term horizon.
24 hour perspective: “Our expectation for the British pound to rise above 1.3760 did not materialize as it fell to 1.3680 before quickly rebounding to a high of 1.3749. The underlying tone still appears to be positive and there is a chance that the GBP will break above 1.3760. That said, the next resistance at 1.3800 is not expected to enter the picture. On the downside, the minimum of 1.3680 is acting as a solid support and it is unlikely to be threatened (1.3710 is already quite a strong level) ”.
Next 1-3 weeks: “We highlighted last Friday (Feb 5, pair at 1.3675) that only a daily close below 1.3580 or above 1.3760 would indicate that the GBP was ready for a sustained directional move. Since then, the underlying short-term tone has improved and the bias is up. From here, the British pound could rise but the pace of any advance is likely to be slow and 1.3800 may not hit the scene as soon. On the downside, a breakout of 1.3640 (‘strong support’ level) would indicate that the current slight upward pressure has eased. “
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