GBP/USD: Extra gains forecast above 1.3280 – UOB

Cable could extend the upside to the 1.3320 area once 1.3280 is cleared, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “GBP traded between 1.3167 and 1.3242 yesterday before closing largely unchanged at 1.3202 (+0.02%). Upward momentum is showing tentative sign of improving and while GBP could move above the 1.3250 resistance, it may not be able to maintain a foothold above this level. Next resistance is at 1.3280. Support is at 1.3185 followed by 1.3160.”

Next 1-3 weeks: “Last Friday (13 Nov, spot at 1.3120), we held the view that GBP ‘could trade sideways within a broad 1.3000/1.3250 range for a period of time’. The relatively rapid manner by which GBP approaches the top of the range was not exactly expected (overnight high of 1.3242). Despite the advance, upward momentum has not improved by much. That said, a move above 1.3250 is not ruled out but GBP has to close above 1.3280 in order to indicate that it ready to move towards last week’s top at 1.3322. For now, the prospect for such a scenario is not high but it would remain intact as long as GBP does not move below 1.3130 within these few days.”