British Pound: Downside risks with 1.3480 in sight against US Dollar – UOB
United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann report that GBP/USD fell sharply to 1.3527 and closed at 1.3540, contradicting expectations for range trading. Intraday, they see limited further losses within 1.3520–1.3570 due to oversold conditions.
UOB's analysts Quek Ser Leang and Lee Sue Ann report a sharp decline in GBP/USD to 1.3527, subsequently closing at 1.3540. Initially, they anticipated range trading but observed limited further losses within 1.3520-1.3570 due to oversold conditions. Over the coming weeks, market risk leans lower, targeting 1.3480 while GBP remains capped below 1.3600.
On Friday, GBP fell to 1.3571 before closing at 1.3594 (-0.03%). Despite this, the analysts noted that "oversold conditions, combined with slowing momentum, suggest that instead of continuing to decline today, GBP is more likely to trade in a range of 1.3570/1.3620." However, GBP fell sharply to a low of 1.3527, contradicting their earlier expectations.
Conditions remain deeply oversold, and any further decline appears unlikely. Today, GBP may edge lower, but any decline should stay within a range of 1.3520/1.3570. Analysts anticipate further downside pressure as long as GBP holds below the 'strong resistance' level of 1.3600.
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