GBP/USD targets YTD tops once 1.3100 is cleared – UOB

In view of FX Strategists at UOB Group, Cable could re-test the 1.3270 area once 1.3100 is cleared.

Key Quotes

24-hour view: “The target highlighted at 1.3065 yesterday was exceeded as GBP touched a high of 1.3082 (as expected, the major 1.3100 resistance was unchallenged). While upward momentum has waned considerably, it is too early to expect a deeper pullback. GBP is more likely to consolidate its gains and trade sideways at these higher levels. That said, the immediate bias is for a probe lower towards the bottom of the expected 1.3000/1.3075 consolidation range”.

Next 1-3 weeks: “As highlighted yesterday, while upward momentum has improved, we are not convinced that the current movement is the start of a bullish phase. That said, GBP is expected to stay supported in the coming days unless there is a drop back below 1.2940. On a shorter-term note, 1.2970 is already a strong support. On the upside, GBP has to clear 1.3100 to indicate that a move towards the year-to-date high at 1.3267 has started”.