GBP/USD: A potential test of 1.2330 remains in store – UOB

Extra gains could encourage GBP/USD to revisit the 1.2330 region in the next few weeks, comment Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group.

Key Quotes

24-hour view: “We held the view yesterday that ‘there is room for one more push higher in GBP before the risk of a pullback increases’. However, GBP traded sideways between 1.2111 and 1.2189. The price actions appear to be consolidative and GBP is likely to continue to trade sideways. The expected range for today is 1.2100/1.2200.”

Next 1-3 weeks: “Our update from yesterday (10 Jan, spot at 1.2180) is still valid. As highlighted, after the sharp advance in GBP earlier this week, the odds of GBP breaking the resistance at 1.2270 have increased. The GBP strength is intact as long as it does not break the ‘strong support’ at 1.2030 (no change in level from yesterday).”