1.3265 in focus: British Pound has a short-term downside bias against US Dollar – UOB

GBP/USD rebounded to 1.3339. UOB strategists Quek Ser Leang and Lee Sue Ann say the recovery followed a deeper-than-expected decline, relieving immediate downward pressure and suggesting an intraday trading range of 1.3295 to 1.3350. Their bias remains negative over 1–3 weeks, with a move towards 1.3265 in view while the pair holds below strong resistance at 1.3365. That contrasts with their longer-term outlook for a possible rebound towards 1.3480.

1.3265 in focus as pound consolidates with medium-term downside risk

"24-HOUR VIEW: GBP fell more than we expected two days ago, reaching a low of 1.3307. When it was at 1.3310 yesterday, we highlighted the following: “Despite declining, GBP has not gained much momentum. That said, there is scope for GBP to break below 1.3290. The next support at 1.3265 is unlikely to come under threat for now. To keep the momentum going, GBP must hold below 1.3335.” GBP subsequently fell to a low of 1.3274 and then rebounded strongly, reaching a high of 1.3339 in the NY session. The immediate downward pressure has eased, and today, GBP is likely to range-trade between 1.3295 and 1.3350"

"1-3 WEEKS VIEW: We turned negative on GBP yesterday (28 Oct, spot at 1.3310). We indicated that “the rapid increase in downward momentum has shifted the bias for GBP to the downside, likely toward 1.3265.” We added, “the downside bias will remain intact as long as GBP holds below the ‘strong resistance’ level, now at 1.3365.” We continue to hold the same view."

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