GBP/USD remains constructive above 1.3190 – UOB

FX Strategists at UOB Group stay neutral on Cable, although the outlook is expected to improve as long as 1.3190 holds.

Key Quotes

24-hour view: “The anticipated GBP strength exceeded our expectation by not only taking out 1.3300 but also the strong 1.3330 resistance. However, the sharp pullback from a high of 1.3337 suggests that a short-term top is in place. That said, it is too early to expect a sustained down move and GBP is more likely to consolidate its gain and trade sideways at these higher levels. Expected range for today; 1.3240/1.3320”.

Next 1-3 weeks: “GBP edged above the top end of our expected 1.3100/1.3330 consolidation last Friday and touched a high of 1.3337. The undertone has improved considerably but we think it is too early to expect a sustained up-move in GBP. There is another strong resistance at 1.3380 and only a daily closing above this level would indicate the start of a bullish phase. To put it another way, the odds for such a move are not high at this stage but would continue to improve as long as GBP can hold above 1.3190 in the coming days”.