GBP/USD upside pressure alleviated below 1.4000 – UOB

According to FX Strategists at UOB Group, a close below the 1.40 milestone should mitigate the upside pressure around the pair.

Key Quotes

24-hour view: “The ‘target’ indicated at 1.4070 yesterday as GBP hit an overnight high of 1.4076. The up-move was however short-lived and the rapid pullback from the top suggests that GBP has likely moved into a consolidation phase. In other words, sideways trading is expected for today, likely between 1.4020 and 1.4085”.

 Next 1-3 weeks: “While the pullback from last Tuesday (27 Mar) 1.4244 peak is deeper and more resilient than expected, we continue to detect a positive undertone and still see chance for GBP to move higher and test the major 1.4280 resistance. Only a clear break below 1.4000 would indicate that the current mild upward pressure has eased. However, a break of 1.4000 would not shift the current neutral phase to bearish but would indicate that GBP has moved into a lower consolidation range. All that said, GBP has to move and stay above 1.4100 within these few days or the odds for a move towards 1.4280 would diminish further”.