GBP/USD now targets 1.4200 near term – UOB

Cable’s up move could now extend towards the 1.4200 area in the next weeks, according to FX Strategists at UOB Group.

Key Quotes

24-hour view: “We highlighted yesterday that “a move towards 1.4130 would not be surprising but a break of 1.4160 is not expected”. However, GBP managed to rise to a high of 1.4163 before easing off quickly. Despite the pull-back, it is too early to expect a significant down-move. GBP is more likely to consolidate its gains and trade sideways at these higher levels. Expected range for today; 1.4095/1.4165”.

Next 1-3 weeks: “The continuing short-term strength came as a surprise as GBP edged above the top of our expected 1.3935/1.4160 consolidation range yesterday to reach a high of 1.4163. The improved undertone suggests that there is scope for GBP to test the next strong resistance at 1.4200 but at this stage, we do not anticipate a sustained move above this level (next resistance is at last month’s 1.4244 peak). In other words, the current short-term GBP could lead to a move towards 1.4200 but any up-move is unlikely to be sustained”.