GBP/USD: A breakout of 1.1700 appears not favoured – UOB

A move beyond 1.1700 in GBP/USD looks unlikely for the time being, noted FX Strategists at UOB Group Quek Ser Leang and Peter Chia.

Key Quotes

24-hour view: “We expected GBP to ‘continue to range-trade’ last Friday. Instead of range-trading, GBP soared to a high of 1.1646 before closing higher by 0.75% (NY close of 1.1584), its biggest 1-day gain in more than a month. While approaching overbought, the advance in GBP could extend to 1.1665. For today, the next resistance at 1.1700 is not expected to come into view.  Support is at 1.1575 followed by 1.1550.”

Next 1-3 weeks: “We turned neutral on GBP last Wednesday (06 Sep, spot at 1.1575) and expected it to consolidate. Last Friday, GBP soared to a high of 1.1646, above the top of our expected range. Upward momentum has improved, albeit not by much. From here, GBP is likely to edge higher but the chance for a break of the major resistance at 1.1700 is not high for now. On the downside, a breach of 1.1520 would indicate that the current upward pressure has eased.”