GBP/USD neutral, room for a test of 1.2920 – UOB

Cable stays on a neutral stance and could attempt a visit to the 1.2920 region in the near term, noted FX Strategists at UOB Group.

Key Quotes

“GBP spiked to an overnight high of 1.2860 before easing off quickly. The rally appears to be over-extended and while a retest of 1.2860 is not ruled out, a move beyond the next major resistance at 1.2920 is not expected. Support is at 1.2780 followed by 1.2755”.

“While GBP moved clearly above the expected 1.2640/1.2820 consolidation range (overnight high of 1.2860), we are not convinced that it has moved into a bullish phase. However, the immediate pressure is clearly on the upside but at this stage, a sustained move above the trend-line resistance at 1.2920 seems unlikely. Overall, while the outlook is still deemed as neutral, GBP is expected to stay underpinned in the coming days with solid support at 1.2720”.