Extra decline remains on the cards for GBP/USD in the next few weeks, according to UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang.

Key Quotes

24-hour view: “We highlighted yesterday that ‘the price actions appear to be consolidative’ and we expected GBP to consolidate in a range of 1.2320/1.2390. In line with our expectations, GBP consolidated, albeit in a narrower range than expected (1.2337/1.2371), The quiet price actions offer no fresh clues and we continue to expect GBP to consolidate, likely between 1.2325 and 1.2385.”

Next 1-3 weeks: “Our update from last Friday (26 May, spot at 1.2320) still stands. As highlighted, the 2-week weakness in GBP is intact but it remains to be seen if 1.2175 will come into view this time around. On a shorter-term note, it is worth noting that both 1.2300 and 1.2250 are strong support levels. On the upside, a breach of 1.2415 (no change in ‘strong resistance’ level) would suggest the GBP weakness has stabilized.”