GBP/USD still bearish, still targets 1.3660 – UOB

FX Strategists at UOB Group remain negative on Cable while it is expected to test 1.3660 in the next weeks.

Key Quotes

24-hour view: “In line with expectation, GBP traded mostly sideways on Friday albeit at a narrower range than anticipated. While the undertone has improved somewhat, any gains from here are viewed as part of a higher 1.3750/1.3850 sideway trading range and not the start of a sustained up-move. In other words, further sideway trading is expected albeit likely at a higher range”.

Next 1-3 weeks: “There is not much to add as GBP rebounded last Friday but held well below the ‘stop-loss’ for our bearish view at 1.3890. Shorter-term downward momentum has eased somewhat and this could lead to a few days of consolidation first before the next ‘down-leg’ within the current bearish phase can be expected. Overall, only a break above 1.3890 would indicate that our expectation for the recent drop in GBP to extend to 1.3660 is wrong”.