GBP/USD neutral, a test of 1.4280 lost momentum – UOB

In view of FX Strategists at UOB Group, Cable’s potential test of the 1.4280 region seems to have lost some traction now.

Key Quotes

24-hour view: “GBP dipped to a low of 1.4011 last Friday before rebounding. A short-term bottom is like in place and the current recovery appears to have scope to extend higher to 1.4070. At this stage, clear break above this level seems unlikely (next resistance is at 1.4100). On the downside, 1.4000 is acting as a solid support and would not be easy to break”.

Next 1-3 weeks: “While the pull-back from last Tuesday (27 Mar) 1.4244 peak is deeper and more resilient than expected, we continue to detect a positive undertone and still see chance for GBP to move higher and test the major 1.4280 resistance. Only a clear break below 1.4000 would indicate that the current mild upward pressure has eased. However, a break of 1.4000 would not shift the current neutral phase to bearish but would indicate that GBP has moved into a lower consolidation range. All that said, GBP has to move and stay above 1.4100 within these few days or the odds for a move towards 1.4280 would diminish further”.