In opinion of FX Strategists at UOB Group, Cable needs to break above 1.3600 to allow for extra gains in the near term.

Key Quotes

24-hour view: “We expected GBP to ‘consolidate and trade within a range of 1.3525/1.3595’ yesterday. While our view for consolidation was not wrong, GBP traded within a lower range than expected (1.3491/1.3558). Momentum indicators are flat and GBP could consolidate further. Expected range for today, 1.3485/1.3570.”

Next 1-3 weeks: “There is no change in our view from yesterday (06 Jan, spot at 1.3555). As highlighted, upward momentum has improved slightly but GBP has to break 1.3600 before further advance is likely. The chance for GBP to break 1.3600 is not high for now but would remain intact as long as GBP does not move below 1.3460. Looking ahead, the next resistance above 1.3600 is at 1.3630.”