GBP/USD neutral, in a 1.2400/1.2730 range – UOB

According to FX Strategists at UOB Group, Cable’s outlook has shifted to neutral from bullish, expecting to navigate between 1.2400 and 1.2730 in the near term.

Key Quotes

“GBP edged below the strong support indicated at 1.2415/20 yesterday (low of 1.2412) before surging to an overnight high of 1.2595. While upward momentum is not as strong as preferred, further up-move seems likely even though last week’s peak near 1.2675 is unlikely to yield so easily (minor resistance is at 1.2620)”.

“We highlighted the diminished odds for further GBP strength yesterday and the breach of 1.2420 (low of 1.2412) indicates that an interim top is in place. The current movement is viewed as the early stages of a consolidation phase, likely within a broad 1.2400/1.2730 range. Looking further ahead, as long as 1.2400 is not clearly taken out, the consolidation is more likely to be resolved with an upside break”.