GBP/USD keeps the bearish outlook unchanged – UOB

Cable’s perspective remains on the bearish side for the time being, noted FX Strategists at UOB Group.

Key Quotes

24-hour view: “While GBP edged below the strong 1.2845/50 support, it rebounded after touching a low of 1.2842. Downward pressure has eased and the current movement is viewed as part of a consolidation phase. In other words, GBP is expected to trade sideways from here, likely between 1.2850 and 1.2925”.

Next 1-3 weeks: “Despite the lack of a ‘follow-through’ after the break of the major 1.2850 support (GBP eked out a fresh low of 1.2842), it is too early to expect a short-term low. Only a move back above 1.2970 (stop-loss level unchanged) would indicate that the bearish phase that started last Monday, 07 Aug, (spot at 1.3045) has ended. In the meanwhile, we could see a couple of days of short-term consolidation before the next leg lower even though any decline is expected to encounter solid support at 1.2775”.