GBP/USD vulnerable to further downside – UOB

Cable stays under pressure and could attempt a move to the lower end of the 1.30-1.33 range in the near-term, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “Absence of a strong trigger, GBP is likely to continue to drift lower and a further decline to 1.3000 would not come as a surprise. That said, the faltering momentum means that that big figure is likely to hold for now. Sideways pattern is likely to dominate today, with upside kept at 1.3100. Only a move above 1.3135 would indicate the current mild downward pressure has eased.”

Next 1-3 weeks: “GBP touched 1.3210 but retreated quickly and ended the day at 1.3120 (-0.34%). The price action suggests the bottom of the expected 1.3000/1.3300 remains vulnerable (expected range is narrowed from 1.3000/1.3400). All in, GBP is expected to stay under pressure and only a NY closing above 1.3190 would ‘neutralize’ the current downward pressure.”