Pound Sterling (GBP) is expected to trade between 1.2640 and 1.2700 vs US Dollar (USD). In the longer run, momentum has slowed further; a breach of 1.2615 would indicate that GBP is not strengthening further, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.
Momentum has slowed further
24-HOUR VIEW: "While we expected GBP to 'rebound further' yesterday, we noted that it 'does not appear to have enough momentum to reach 1.2730.' Our view was not wrong, as GBP rose to 1.2717, pulling back to close largely unchanged at 1.2674 (+0.06%). Upward has eased, and today, we expect GBP to trade 1.2640 and 1.2700."
1-3 WEEKS VIEW: "While we have held a positive view in GBP since the middle of the month, we highlighted two days ago (25 Feb, spot at 1.2625) that 'upward momentum is beginning to slow, and a breach of 1.2580 (‘strong support’ level) would indicate that 1.2730 is out of reach this time around.' GBP has not been able to make much headway on the upside, and momentum has slowed further. The ‘strong support’ level has moved higher to 1.2615 from 1.2580; a breach of this level would indicate that GBP is not strengthening further."
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