GBP/USD could still push higher – UOB

Cable keeps trading on a positive note and extra gains are not ruled out in the near term, noted FX Strategists at UOB Group.

Key Quotes

24-hour view: “We highlighted yesterday “there is scope for GBP to move above the strong 1.3165/70 level but prospect for a break of the next resistance at 1.3215 is low”. In line with expectation, GBP broke above 1.3165/70 albeit marginally as it hit a high of 1.3173. While upward momentum remains lackluster, GBP could continue to grind higher but a clear break of 1.3215 would come as a surprise. Support is at 1.3135 but only a break of 1.3100 would indicate that a short-term top is in place”.

Next 1-3 weeks: “We have held the same view since last Tuesday (11 Sep, spot at 1.3025) wherein we expect the rebound in GBP to extend to 1.3170. GBP finally reached this level as it touched an overnight high of 1.3173. As highlighted earlier yesterday (18 Sep, spot at 1.3150), while the advance in GBP is approaching overbought, there is no sign of weakness just yet and there is scope for further strength towards the next major level of 1.3215. This is a relatively strong resistance and a break of this level would be a good indication that GBP could continue to advance in the coming days. On the downside, the ‘key support’ is currently at 1.3045, higher from 1.3000 previously”.