Outlook for GBP/USD remains mixed – UOB

Cable is now seen trading within the 1.3750-1.3950 range in the short-term horizon, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “The sharp sell-off in GBP to an overnight low of 1.3802 came as a surprise (we were expecting GBP to move higher to 1.3950). While the rapid drop appears to be overdone, there is room for GBP to dip below 1.3800. For today, the next support at 1.3750 is unlikely to come under threat (1.3770 is already quite a strong level). Resistance is at 1.3865 followed by 1.3890.”

Next 1-3 weeks: “Yesterday (06 Apr, spot at 1.3905), we expected GBP to ‘trade with a positive bias’. Our view was proven wrong as GBP dropped sharply and cracked our ‘strong support’ level at 1.3820 (low of 1.3802). The rapid drop after the previous day’s strong advance has resulted in a mixed outlook. From here, GBP could trade in an ‘undecided’ manner between 1.3750 and 1.3950.”