GBP/USD: Major resistance at 1.3515 is likely out of reach for now – UOB Group

Strong momentum suggests further Pound Sterling (GBP) strength; the major resistance at 1.3515 is likely out of reach for now. In the longer run, rapid increase in momentum could lead to GBP rising to 1.3515, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Strong momentum suggests further GBP strength

24-HOUR VIEW: "Following the sharp rise in GBP on Tuesday, we indicated yesterday, Wednesday, that 'while overbought, the advance could extend to 1.3385.' We added that GBP 'is unlikely to break clearly above this level.' We were correct on the first count, but incorrect on the second, as GBP soared to a high of 1.3450. Strong momentum suggests further GBP strength, even though the major resistance at 1.3515 is likely out of reach for now (there is another resistance level at 1.3480). To maintain the strong momentum, GBP must hold above 1.3395 (with minor support at 1.3425)."

1-3 WEEKS VIEW: "Yesterday (07 Aug, spot at 1.3345), we revised our view from negative to neutral. We indicated that 'the recent GBP weakness had stabilised, and GBP has likely entered a 1.3285/1.3425 range trading phase.' The subsequent sharp rise that reached a high of 1.3448 was surprising. The rapid increase in momentum could lead GBP to rising to 1.3515. We will view GBP in a positive manner as long as it holds above 1.3345."