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FX Strategists at UOB Group noted Cable is now seen trading within the 1.3760-1.3910 range in the next weeks.
Key Quotes
24-hour view: “Last Friday, we held the view that GBP ‘could edge lower but the major support at 1.3715 is likely out of reach’. GBP subsequently dropped to 1.3734 before staging a sharp rebound and ended the day on a firm note at 1.3836 (high has been 1.3844). The rebound appears to be running ahead of itself but there is scope for GBP to test 1.3860 first before easing. Support is at 1.3805 followed by 1.3780.”
Next 1-3 weeks: “We indicated last Friday (02 Jul, spot at 1.3765) that GBP ‘is in a weak phase and the next level to focus on below 1.3750 is at 1.3715’. GBP subsequently dropped to 1.3734 before snapping back up to within one pip of our ‘strong resistance’ level at 1.3845 (high of 1.3844 during late NY hours). While the ‘strong resistance’ level is still intact, the rapid loss in downward momentum indicates that the weak phase in GBP has ended sooner than expected. From here, GBP could trade between 1.3760 and 1.3910 for a period of time.”