GBP/USD: Further upside likely above 1.3645 – UOB

In opinion of FX Strategists at UOB Group, GBP/USD needs to clear 1.3645 to allow for extra gains in the next weeks.

Key Quotes

24-hour view: “Yesterday, we expected GBP to ‘trade within a range of 1.3500/1.3590’. However, GBP rose to 1.3600 before closing on a firm note at 1.3583 (+0.30%). Upward momentum is beginning to build and the risk for today is on the upside. However, in view of the nascent build-up in momentum, the major resistance at 1.3645 is unlikely to come under threat for now (there is another resistance at 1.3620). Support is at 1.3565 followed by 1.3545.”

Next 1-3 weeks: “We have held the same view since last Friday (11 Feb, spot at 1.3550) where GBP is likely trade between 1.3450 and 1.3645 for now. After trading sideways for several days, shorter-term upward momentum is beginning to build. That said, GBP has to close above 1.3645 before a sustained advance is likely. The chance of GBP closing above 1.3645 is not high for now but it would increase as long as GBP does not move below 1.3520 within these couple of days. Looking ahead, the next resistance above 1.3645 is another rather strong level at 1.3680.”