GBP/USD rebound could extend to 1.3020 – UOB

According to FX Strategists at UOB Group, Cable could see a test of the 1.3020 region in the next weeks.

Key Quotes

24-hour view: “GBP hit a 3-week high of 1.2995 last Friday before easing off. Despite the pull-back, the undertone is still positive and a retest of 1.2995 would not be surprising. However, the next resistance at 1.3020 is likely out of reach for now. Support is at 1.2930 but only a move back below 1.2905 would indicate that the current mild upward bias has eased”.

Next 1-3 weeks: “We have held the same view that the “strong rebound in GBP has scope to extend higher to 1.3020” since last Monday (28 Aug). GBP hit a high of 1.2995 last Friday and the mild upward pressure has improved further. In other words, we continue to anticipate a move to 1.3020 even though this is a rather strong resistance and may not yield so easily. This level is followed by another strong resistance near 1.3060. On the downside, only a move back below 1.2885 would indicate that the current upward pressure has eased. On a shorter-term note, 1.2905 is already a strong support”.