Cable remains on track for a potential test of the mid-1.3000s in the next weeks, suggested FX Strategists at UOB Group.
“The year-to-date high near 1.3045/50 was not threatened as GBP dropped sharply from a high of 1.3030. The subsequent rapid rebound from the low suggests that another attempt towards 1.3045/50 seems likely but based on the current momentum, a clear break above this level is not expected (next resistance is at 1.3100). Support is at 1.2985 followed by last Friday’s low near 1.2945”.
“There is no change to the current bullish outlook for GBP. While the recent rally is overbought, there is a room for extension to 1.3045/50. A break above this level would shift the focus to towards 1.3160. On the downside, only a move below 1.2925 would indicate that the bullish phase has ended”.