GBP/USD still bearish, room for a test of 1.2775 – UOB

FX Strategists at UOB Group remain bearish on Cable and expect it to test the 1.2770 region in the next weeks.

Key Quotes

24-hour view: “GBP traded in a range of 1.3832/1.2919, modestly wider than our expected 1.2830/1.2910 consolidation range. The daily closing is largely unchanged which suggests further range trading, likely not moving much out of last Friday's range”.

Next 1-3 weeks: “The bearish phase that started two weeks ago (see update on 07 Aug, spot at 1.3045) is still intact as GBP eked out a ‘fresh low’ of 1.2832 last Friday. Downward momentum appears to be struggling even though another leg lower towards the major support at 1.2775 is not ruled out just yet. Only a move back above 1.2970 (stop-loss level unchanged) would indicate that the bearish phase has ended (on a shorter-term note, GBP should ideally hold below the 1.2920 resistance)”.