Cable is now expected to trade between 1.30 and 1.33 amid the current mixed outlook, UOB Group’s FX strategists have suggested.
24 hour view: “We expected the GBP to strengthen yesterday, but we were of the opinion that” the odds of a sustained rise above last week’s high near 1.3265 are not high ”. We pointed out that “there is another strong resistance at 1.3300”. During the New York session, the GBP briefly jumped to a high of 1.3285 before falling back to end the day at 1.3195 (-0.09%). Despite the daily close largely unchanged, the underlying tone appears to have weakened somewhat. From there, the GBP could drift lower, but any weakness is considered a lower trading range of 1.3155 / 1.3255. “
Next 1-3 weeks: “Yesterday (August 26th, spot at 1.3145) we reported that the ‘odds for the GBP to move to 1.2980 decreased: the GBP then broke through the’ strong resistance ‘level of 1.3200 and the recent downward climb the momentum has dissipated. From there, the outlook for the GBP is mixed. Looking back, the GBP’s movement for most of this month has been erratic, especially in the past few days where there have been several relatively large (and rapid) but short-lived swings. For now, the GBP may continue to trade volatile between the two main levels of 1.3000 and 1.300. Only a clear break in one or the other of the two levels would indicate the start of a more sustained directional movement. “