GBP/USD clings to the neutral stance short term – UOB

In view of FX Strategists at UOB Group, Cable stays neutral in the near term and could still test the 1.3030 area.

Key Quotes

24-hour view: “The anticipated recovery exceeded our expectation as GBP easily moved above the target indicated at 1.3175 yesterday (high of 1.3215). There appears to be room for a slightly higher extension to 1.3240 but at this stage, we do not anticipate a break above last week’s top near 1.3280. Support is at 1.3170 followed by 1.3135”.

Next 1-3 weeks: “Despite the positive daily closing yesterday, the undertone for GBP still appears weak and we continue to anticipate a move lower towards the major 1.3025/30 support. At this stage, a clear break below this level is not expected. On the upside, only a sustained move above 1.3240 (say a daily closing above this level) would indicate that the current mild downward pressure has eased”.