GBP/USD gains appear limited around 1.2270 – UOB

Cable remains under pressure, while further upside beyond 1.2770 seems unlikely in the near term, suggested FX Strategists at UOB Group.

Key Quotes

“While we noted the patchy downward momentum and were of the view that any GBP weakness is likely to be limited, the strong recovery from the low of 1.2567 was unexpected. From here, a move above the overnight high of 1.2700 would not be surprising but any further extension is not expected to threaten the 1.2775 high seen last week (minor resistance at 1.2730)”.

“GBP continue to trade in a choppy manner and there is no change to the current neutral view for this pair. Improved short-term upward momentum could lead to a move above the expected consolidation range of 1.2480/1.2750 but 1.2775 is another major resistance and this level is unlikely to yield so easily”.