GBP/USD shifts the focus to 1.3100 – UOB
|UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang suggest GBP/USD could revisit 1.3100 in the not-so-distant future.
Key Quotes
24-hour view: We expected GBP to break above 1.2950 yesterday. However, we highlighted that “it remains to be seen if there is enough momentum to carry GBP to the next major resistance at 1.3000.” In NY trade, GBP rose one pip above 1.3000 before closing on a firm note at 1.2990 (+0.45%). Conditions are severely overstretched, but only a breach of 1.2930 (minor support is at 1.2965) would indicate that the current upward pressure has faded. As long as 1.2930 is not breached, GBP could grind higher to 1.3035. The major resistance at 1.3100 is highly unlikely to come into view today.
Next 1-3 weeks: Yesterday (12 Jul, spot at 1.2930), we highlighted that “the risk is for GBP to rise further.” We added, “if it breaks above 1.3000, the focus will shift to 1.3100”. In late NY trade, GBP rose to a high of 1.3001. While the focus is at 1.3100 now, severely overbought conditions suggest it may take a few days before this level comes into view. Overall, only a breach of 1.2885 (‘strong support’ level was at 1.2820 yesterday) would indicate that the GBP strength that started on Monday has come to an end.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.