GBP/USD is expected to remain volatile – UOB

Cable is seen trading within a volatile fashion in the near term and does not rule out a visit to the 1.14 area, noted FX Strategists at UOB Group.

Key Quotes

24-hour view: “GBP traded between 1.1473 and 1.1800 yesterday, wider than our expected range of 1.1500/1.1780. The strong closing of 1.1774 (+1.91%) suggests there is room for GBP to move towards 1.1900. For today, a sustained advance above this level is not expected. Support is at 1.1700 followed by 1.1600.”

Next 1-3 weeks: “There is not much to add to the update from Monday (23 Mar, spot at 1.1615). As highlighted, GBP could continue to trade in a volatile manner and a break of 1.1400 is not ruled out just yet. That said, shorter-term downward momentum is beginning to wane and the risk of a break of 1.1400 has diminished. However, only a move above 1.2150 (no change in ‘strong resistance’ level) would indicate that GBP is ready to take a breather from its recent ferocious decline. Meanwhile, a 1 to 2 percent daily swing appears to be the new normal for now.”