GBP/USD still focused on 1.3100 – UOB

According to FX Strategists at UOB Group, Cable’s rebound could extend towards the 1.3100 handle in the next weeks.

Key Quotes

24-hour view: “GBP traded between 1.2952 and 1.3042 last Friday, narrower than our expected 1.2940/1.3060 consolidation range. However, GBP opened higher this morning as Brexit news over the weekend sent it briefly to a high of 1.3065 during early Sydney hours. The volatile price action has resulted in a mixed outlook and GBP is likely to continue to trade in a choppy manner and within a broad range. Expected range for today; 1.2950/1.3050”.

Next 1-3 weeks: “There is not much to add to last Friday’s (02 Nov, spot 1.3000) update. As highlighted, despite the strong advance in GBP, we do not think the price action is the start of a major bullish reversal. That said, we see room for the current GBP strength to extend to 1.3100 but in view of the severely overbought conditions, the rally should at least temporary ease upon off from there. On the downside, 1.2840 is likely strong enough to hold any interim GBP weakness, at least for the next one week or so”.