GBP/USD: Next resistance comes at 1.1600 – UOB

In the opinion of UOB Group’s Markets Strategist Quek Ser Leang and Senior FX Strategist Peter Chia, GBP/USD could now target the 1.1600 region in the near term.

Key Quotes

24-hour view: “Our expectation for GBP to trade sideways yesterday was incorrect as it lifted off in NY trade and surged to 1.1500 before easing to close at 1.1472 (+1.68%). The sharp and swift rally appears to be overdone but GBP could test 1.1520 first before easing. For today, the next resistance at 1.1600 is unlikely to come into view. On the downside, 1.1380 is likely strong enough to hold any intraday pullback (minor support is at 1.1420).”

Next 1-3 weeks: “We highlighted yesterday (25 Oct, spot at 1.1300) that GBP is mildly supported and could edge higher. We added, “any advance is expected to face solid resistance at 1.1440”. The anticipated resistance did not materialize as GBP blew past 1.1440 and surged to 1.1500. The strong boost in momentum is likely to lead to further GBP strength. The next resistance is at 1.1600. The GBP strength is intact as long as it does not move below 1.1310 (‘strong support’ level was at 1.1150 yesterday).”