GBP/USD outlook shifted to bullish, targets 1.2650 – UOB

FX Strategists at UOB Group shifted their outlook on Cable to bullish, expecting a potential test of the mid-1.2600s.

Key Quotes

“We have been positive GBP since the middle of last week (post UK PM May’s speech) and were of the view that the strong rebound at that time has room to extend higher to 1.2480”.

“However, the ease of which this strong declining trend-line resistance was taken out yesterday came as a surprise”.

“Upward momentum has improved significantly and from here, GBP appears to have entered a bullish phase with an immediate target of 1.2650”.

“That said, shorter-term indicators are looking overbought and those looking to turn long may likely to wait for a dip closer to 1.2460/70. Support is at 1.2430 but only a move below 1.2355 would indicate that our bullish expectation is wrong”.