Pound Sterling (GBP) may retest the 1.3535 stage towards US Greenback (USD); the most important help at 1.3510 is unlikely to come back underneath menace. Within the longer run, the probability of GBP dropping to 1.3510 is rising, UOB Group’s FX analysts Quek Ser Leang and Peter Chia notice.
The probability of GBP dropping to 1.3510 is rising
24-HOUR VIEW: “Subsequent to Wednesday’s quiet value motion, we identified yesterday (Thursday) that ‘momentum indicators are nonetheless largely flat.’ We anticipated GBP to ‘commerce in a sideways vary of 1.3570/1.3635.’ Our evaluation turned out to be incorrect, as GBP plummeted to a low of 1.3534. The decline, nevertheless, was temporary, as GBP rebounded swiftly to shut largely unchanged at 1.3580 (-0.07%). GBP fell after the shut, and right this moment, GBP may retest the 1.3535 stage. The present momentum appears to counsel the most important help at 1.3510 is unlikely to come back underneath menace. Resistance ranges are at 1.3585 and 1.3605.”
1-3 WEEKS VIEW: “Final Thursday (03 Jul, spot at 1.3650), we indicated that ‘short-term downward momentum is rising, however it isn’t sturdy sufficient to point a sustained decline simply but.’ We additionally highlighted that ‘for a continued down-move, GBP should first shut beneath 1.3560.’ After GBP fell to a low of 1.3528 on Tuesday and closed at 1.3593, we highlighted two days in the past (09 Jul, spot at 1.3590) that ‘the probability of GBP dropping to 1.3510 is rising.’ We’ll preserve our view supplied that the ‘sturdy resistance’ at 1.3645 (stage was at 1.3680 yesterday) will not be breached. Trying forward, ought to GBP break clearly beneath 1.3510, the main focus will shift to 1.3465.”
