In the opinion of Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group, GBP/USD is expected to climb further and could revisit 1.2200 in the next weeks.

Key Quotes

24-hour view: “While we expected GBP to strengthen yesterday, we were of the view that it ‘is unlikely to break the major resistance at 1.1940’. However, GBP blew past 1.1940 and rocketed to a high of 1.2080. There is room for GBP to strengthen further but in view of the deeply overbought conditions, the next major resistance at 1.2200 is unlikely to come into view (there is another resistance at 1.2140). On the downside, a breach of 1.1975 (minor support is at 1.2025) would indicate that the strong rally is ready to take a breather.”

Next 1-3 weeks: “Our latest narrative was from Tuesday (22 Nov, spot at 1.1825) where GBP is likely to trade between 1.1680 and 1.1940 for the time being. Yesterday (23 Nov), GBP lifted off and rocketed past 1.1940 (high has been 1.2080). The rapid accumulation of momentum suggests GBP is likely to strengthen further in the coming days. The level to monitor is at 1.2200. The upside risk is intact as long as GBP does not move below 1.1930 (‘strong support’ level).”