Expected to trade in a range of 1.3340/1.3420 – UOB Group

The British Pound (GBP) is expected to trade in the 1.3340/1.3420 range. Longer term, GBP needs to hold above 1.3455 to regain strength, note UOB Group FX analysts Quek Ser Leang and Lee Sue Ann.

GBP needs to break and hold above 1.3455 to regain strength

24 HOUR OUTLOOK: “We expected GBP to rise last Friday, but thought ‘any advance above 1.3455 is unlikely.’ GBP later rose, but less than expected, hitting a high of 1.3428. GBP closed up 0.32% at 1.3372. The momentum indicators are turning flat and the current price movements are probably part of a range trading phase. Estimated range for today: 1.3340/1.3420.”

1-3 WEEKS VIEW: “Last Thursday (September 26 at 1.3325), we indicated that GBP’s ‘over-a-week rally has ended’. We expected GBP to “trade in the 1.3200/1.3430 range for now”. After GBP rose to 1.3434, we indicated last Friday (September 27th at 1.3410) that “while upside momentum appears to be building again, it is not enough to indicate resumption of GBP strength”. We also indicated that GBP “needs to break and hold above 1.3455 before a further advance to 1.3500 can be expected, and the likelihood of it breaking clearly above 1.3455 appears low for now, but will remain intact as long as 1.3310 is not breached in these few. days.’ We continue to have the same opinion.”