Downward momentum is slowing – UOB Group

The Pound Sterling (GBP) is expected to trade in a sideways range of 1.2940/1.2995. In the longer run, downward momentum is slowing; should GBP break above 1.3000, it would indicate that GBP is not declining further, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

GBP has a chance of breaking above 1.3000

24-HOUR VIEW: “We expected GBP to trade sideways between 1.2930 and 1.2990 yesterday. It subsequently traded in a higher range of 1.2942/1.3001, closing largely unchanged at 1.2972. The price action still appears to be part of a sideways trading phase. Today, we expect GBP to trade in a 1.2940/1.2995 range.”

1-3 WEEKS VIEW: “Yesterday (28 Oct, spot at 1.2960), we indicated that ‘downward momentum is slowing, and should GBP break above 1.3000 (‘strong resistance’ level), it would indicate that GBP is not declining further.’ In NY trading, GBP rose briefly to 1.3001, pulling back to close little changed at 1.2972 (+0.09%). As our ‘strong resistance’ has not been clearly breached, we will continue to hold the same view for now. That said, the likelihood for GBP to decline further is not high.”