British Pound: Consolidation with limited upside scope against US Dollar – UOB

United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann analysts report GBP/USD traded quietly between 1.3423 and 1.3456 after a prior spike to 1.3506. They expect near‑term consolidation in a 1.3425–1.3470 band. Over 1–3 weeks, momentum has eased but a move toward 1.3555 is still possible as long as 1.3385 holds, while the broader 1–3 month view remains for range trading between 1.3210 and 1.3655.

Range trade with residual upside risk

"24-HOUR VIEW: Two days ago, GBP rose to 1.3506 and then pulled back sharply. Yesterday, when GBP was at 1.3430, we highlighted that “the pullback has scope to extend but given that there has been no clear increase in downward momentum, any decline is likely part of a lower range of 1.3400/1.3475.” The subsequent price movements did not unfold as expected. GBP traded in a relatively quiet manner between 1.3423 and 1.3456. The price movements are likely part of a range-trading phase. Today, we expect GBP to trade between 1.3425 and 1.3470."

"1-3 WEEKS VIEW: Our most recent narrative was from Monday (03 Aug, spot at 1.3485), when we indicated that “while strong momentum suggests further upside, it remains to be seen whether GBP can break and hold above the significant resistance at 1.3555.” Upward momentum has since eased, but as long as 1.3385 (no change in ‘strong support’ level) is not breached, there is still a chance, albeit not a high one, for GBP to rise toward 1.3555."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)