GBP/USD: Too early to expect the late July high, near 1.3590 - UOB Group

There is scope for Pound Sterling (GBP) to continue to rise to 1.3555. Above this level, one can expect GBP/USD to rise towards the late July high, near 1.3590, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

The 'strong support' level is now at 1.3420 instead of 1.3365

24-HOUR VIEW: "We expected GBP to 'consolidate between 1.3395 and 1.3465' yesterday. However, instead of consolidating, GBP rose to a high of 1.3523. There has been an increase in momentum, albeit not significantly. Today, GBP could continue to rise, but any advance is unlikely to reach the major resistance at 1.3555. Note that there is another resistance level at 1.3530. To sustain the momentum, GBP must not break below 1.3460, with minor support at 1.3480."

1-3 WEEKS VIEW: "Last Friday (08 Aug, spot at 1.3445), we indicated that 'the rapid increase in momentum could lead to GBP rising to 1.3515.' After GBP struggled to extend its advance, we indicated the following yesterday (12 Aug, spot at 1.3435): 'GBP has failed to build on its earlier momentum, as it consolidated over the past couple of days. Nonetheless, as long as 1.3365 ('strong support' level previously at 1.3345) is intact, there is still a chance for GBP to rise to 1.3515.' In the NY session, GBP rose above 1.3515 as it reached a high of 1.3523. Despite the advance, there has been no clear increase in upward momentum. That said, there is scope for GBP to continue to rise to 1.3555. It is too early to expect the late July high, near 1.3590, to come into view. On the downside, the 'strong support' level is now at 1.3420 instead of 1.3365."