So long as Pound Sterling (GBP) holds under 1.3480 in opposition to US Greenback (USD), it may check 1.3405; the most important help at 1.3365 is unlikely to into view. Within the longer run, GBP is more likely to commerce with a downward bias; it’s unclear for now if it could actually attain the most important help at 1.3365, UOB Group’s FX analysts Quek Ser Leang and Peter Chia observe.
GBP is more likely to commerce with a downward bias
24-HOUR VIEW: “GBP rose to a excessive of 1.3588 final Thursday earlier than pulling again sharply. On Friday, when GBP was at 1.3515, we had been of the view that ‘the pullback may prolong however is unlikely to threaten 1.3450.’ Our directional name was not flawed, however GBP fell greater than we anticipated, dropping to a low of 1.3417. Whereas circumstances are oversold, the decline has not stabilised. At this time, so long as GBP holds under 1.3480 (with minor resistance at 1.3455), it may check 1.3400. The main help at 1.3365 is unlikely to come into sight.”
1-3 WEEKS VIEW: “We revised our view from constructive to impartial final Friday (25 Jul, spot at 1.3515). We acknowledged that ‘upward momentum has largely pale’ and we anticipate GBP to ‘commerce in a spread of 1.3450/1.3590.’ We didn’t anticipate GBP to interrupt under 1.3450 and drop to a low of 1.3417. Downward momentum is beginning to construct, albeit tentatively. From right here, we anticipate GBP to commerce with a downward bias, however it’s too early to find out if GBP can attain the most important help at 1.3365 (there may be one other help degree at 1.3405). To maintain the buildup in momentum, GBP should not break above the ‘sturdy resistance’ degree, at the moment at 1.3510.”
