GBP/USD is now expected to navigate between 1.3100 and 1.3235 in the next weeks, noted FX Strategists at UOB Group.

Key Quotes

24-hour view: “Yesterday, we highlighted that ‘the rapid decline appears to be overdone and GBP is unlikely to weaken much further’ and we expected GBP to ‘trade between 1.3160 and 1.3260’. GBP subsequently dipped to 1.3157 during early London hours before rebounding to trade sideways for the rest of the sessions. Momentum indicators appear to be flattish and GBP is likely to trade sideways for today. Expected range for today, 1.3165/1.3235.”

Next 1-3 weeks: “GBP dipped below our ‘strong support’ level of 1.3160 yesterday (low of 1.3157). The breach of the ‘strong support’ indicates that the GBP strength that started late last week has come to an end. To look at it another way, GBP appears to have moved into a consolidation phase and is likely to trade between 1.3100 and 1.3300 for now.”