GBP/USD now looks to 1.2535 – UOB

Cable’s outlook seems to have improved and it could now advance to the 1.2535 level, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “Our expectation for GBP to ‘continue to consolidate’ and ‘trade between 1.2300 and 1.2400’ was incorrect as it soared to a high of 1.2455. While reaching overbought, the advance in GBP appears to have enough momentum to stage a push above the 1.2455 high. For today, the prospect for GBP to move beyond the next resistance at 1.2490 is not high. Support is at 1.2400 followed by 1.2360. The latter level is acting as a rather solid support for today.”

Next 1-3 weeks: “We highlighted last Friday that ‘the odds for a lower GBP have diminished’. After trading in a quiet manner for a couple of days, GBP took out the 1.2400 ‘strong resistance’ and soared to a high of 1.2455 yesterday (27 Apr). The tentative pick-up in momentum suggests GBP could edge higher from here but GBP has to crack 1.2535 before a stronger and more sustained advance can be expected. Overall, the outlook for GBP is viewed as mildly positive as long as it does not move below 1.2320 within these few days.”