GBP/USD now seen within 1.3700-1.3855 – UOB

Cable has now moved into a consolidative phase, likely between 1.3700 and 1.3855 for the time being, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “We highlighted yesterday that ‘further GBP weakness seems likely even though oversold conditions could ‘limit’ any decline to a test of 1.3750’. We added, ‘the major support at 1.3700 is not expected to come under threat’. Our view for GBP to weaken was not wrong but GBP cracked 1.3750 and dropped to 1.3727 before staging a sharp and rapid rebound. Conditions remain oversold and this coupled with waning momentum suggests that GBP is unlikely to weaken further. For today, GBP is more likely to trade sideways between 1.3730 and 1.3800.”

Next 1-3 weeks: “There is not much to add to our update from yesterday (08 Sep, spot at 1.3780). As highlighted, GBP has likely moved into a consolidation phase and could trade between 1.3700 and 1.3855 for a period of time.”