GBP/USD: Set to decline further to 1.2860 – UOB Group
|The Pound Sterling (GBP) is expected to trade in a range between 1.2930 and 1.3000. In the longer run, price action suggests GBP could decline further to 1.2860, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.
GBP to trade between 1.2930 and 1.3000
24-HOUR VIEW: “Our view for GBP to ‘continue to weaken’ yesterday was incorrect. Instead of weakening, GBP rose to a high of 1.2985. Despite the relatively strong advance, upward momentum has not increased much. Today, we expect GBP to trade in a range, probably between 1.2930 and 1.3000. GBP is unlikely to break clearly below 1.2930 or above 1.3000.”
1-3 WEEKS VIEW: “On Tuesday (22 Oct, spot at 1.2980), we indicated that GBP ‘must break and remain 1.2940 before a resumption of weakness can be expected.’ After GBP plummeted below 1.2940, we indicated yesterday (24 Oct, spot at 1.2915) that ‘The price action indicates GBP could decline further to 1.2860.’ We did not anticipate the rebound that reached 1.2985. However, as our ‘strong resistance’ level at 1.3000 has not been breached yet, we will continue to hold the same view for now.”
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