Present value actions are doubtless a part of a sideways buying and selling part between 1.3515 and 1.3605. Within the longer run, GBP should first shut above 1.3640 earlier than a transfer to 1.3700 may be anticipated, UOB Group’s FX analysts Quek Ser Leang and Peter Chia observe.
Chance of closing above 1.3640 stays intact whereas above 1.3515
24-HOUR VIEW: “GBP rose sharply and closed greater by 0.58% at 1.3615 final Thursday. On Friday, when GBP was at 1.3600, we identified that ‘situations are deeply overbought, and GBP is unlikely to rise a lot additional.’ We anticipated GBP to ‘commerce in the next vary of 1.3540/1.3640.’ Nevertheless, GBP pulled again to 1.3518 earlier than rebounding to shut at 1.3574 (-0.30%). Momentum indicators are turning flat, and the present value actions are doubtless a part of a sideways buying and selling part, most likely between 1.3515 and 1.3605.”
1-3 WEEKS VIEW: “We revised our GBP view to impartial final Thursday (12 Jun, spot at 1.3565), stating that GBP ‘seems to have moved right into a 1.3495/1.3620 vary buying and selling part.’ After GBP rose and closed at 1.3616, we highlighted the next final Friday (13 Jun, spot at 1.3600): ‘Upward momentum is growing, however we favor to attend for a decisive shut above 1.3640 earlier than revising our GBP outlook to constructive. The probability of GBP closing above 1.3640 will stay intact so long as 1.3515 just isn’t breached.’ GBP subsequently pulled again near our ‘robust help’ stage of 1.3515, reaching a low of 1.3518. We’ll preserve our view for now, however after the pullback, the probability of GBP closing above 1.3640 has diminished significantly.”
