GBP/USD: The Next Level of Support Appears Around 1.1800 - UOB

The GBP/USD exchange rate may test 1.1800 in the coming weeks if there is additional downward momentum, according to UOB Group FX Strategists Lee Sue Ann and Quek Ser Leang.

July 12, 2022 - 11:50 AM 247 views

GBP/USD: The Next Level of Support Appears Around 1.1800 - UOB

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The GBP/USD exchange rate may test 1.1800 in the coming weeks if there is additional downward momentum, according to UOB Group FX Strategists Lee Sue Ann and Quek Ser Leang.

Key Quotes

24-Hour View: "GBP yesterday fell to 1.1877 (low of 1.1868), below last week's low, before bouncing back. Even so, the downward momentum hasn't changed significantly. Although the value of the pound could fall, any weakness might only lead to a test of 1.1850. It is unlikely that the key support at 1.1800 will be jeopardised. Resistance is found at 1.1940, then 1.1970.

In the Next 1-3 Weeks: The current GBP decline has run its course, and according to our most recent narrative from last Friday (08 July, spot at 1.2025), we anticipated GBP to consolidate and trade between 1.1900 to 1.2165. We weren't prepared for yesterday's abrupt plunge to 1.1868. The declining momentum over the short term has slightly improved. GBP is most likely to move with a negative tilt in the direction of 1.1800 from here. The likelihood of a sustained slide below 1.1800 is not strong at this time. In conclusion, only a breach of 1.2010 (a'strong resistance' level) would suggest that GBP is not prepared to fall to 1.1800.

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