GBP/USD expected to trade within 1.1925-1.2120 – UOB

According to UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang, GBP/USD is expected to trade between 1.1925 and 1.2120 in the short-term horizon.

Key Quotes
24-hour view: “Our expectations for GBP to weaken further were incorrect as it rebounded to a high of 1.2049. While upward momentum has not improved much with the rebound, GBP could edge higher to 1.2070. The next resistance at 1.2120 is not expected to come under threat. On the downside, a breach of 1.1985 (minor support is at 1.2005) would indicate that the current mild upward pressure has eased.”

Next 1-3 weeks: “Last Friday (03 Mar, spot at 1.1985), we indicated that while downward momentum is beginning to build, GBP has to break 1.1900 before a sustained decline is likely. We added, ‘the chance of GBP breaking 1.1900 will remain intact as long as 1.2045 is not breached within the next few days’. GBP rose to a high of 1.2049 in NY trade. The breach of our ‘strong resistance’ indicates that downward momentum has faded. To look at it another way, instead of heading lower, GBP is likely to continue to consolidate, expected to be between 1.1925 and 1.2120.”