Cable is expected to stay rangebound in the coming weeks, most likely between 1.3735 and 1.3900, according to UOB Group’s FX Strategists.
“While we noted yesterday that ‘downward momentum has not improved by all that much,’ we were of the opinion that GBP ‘could edge lower to1.3775′. Our view was incorrect as GBP rebounded strongly to 1.3890. The rapid bounce appears to be running ahead of itself, and GBP is unlikely to strengthen much further today.
“After GBP fell sharply to 1.3800, we indicated yesterday (14 Jul, spot at 1.3805) that’shorter-term downward momentum has improved somewhat but it is too early to expect the start of a sustained decline’ and that GBP would ‘trade between 1.3735 and 1.3900 for a period of time.’ There is no change in our view for the time being, even though we did not quite anticipate the subsequent rapid decline.’/n
