GBP/USD must clear the 1.2300 degree to permit for sustained beneficial properties within the short-term horizon, recommend FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang.
24-hour view: “We highlighted yesterday that GBP ‘is unlikely to advance additional’ and we anticipated GBP to ‘commerce between 1.2160 and 1.2260’. GBP subsequently traded inside a narrower vary than anticipated (1.2185/1.2250) earlier than closing largely unchanged at 1.2215 (-0.02%). The present motion seems to be a part of a consolidation part and GBP is more likely to commerce sideways for at this time. That stated, the marginally softened underlying tone suggests a decrease vary of 1.2160/1.2240.”
Subsequent 1-3 weeks: “Yesterday (11 Aug, spot at 1.2215), we highlighted that whereas the danger for GBP has shifted to the upside, it has to crack main resistance at 1.2300 earlier than additional sustained advance is probably going. There isn’t any change in our view. The upside threat is unbroken so long as GBP doesn’t transfer under 1.2125 (no change in ‘robust assist’ degree).”