United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann, GBP/USD jumped to a seven-week high near 1.3503 before easing to 1.3472, with intraday action expected to consolidate between 1.3445 and 1.3505. Over the next one to three weeks, they retain a positive view, looking for a move toward 1.3530 while flagging 1.3410 as strong support that would negate the bullish phase if broken.

Sterling consolidation within broader advance

“24-HOUR VIEW: GBP soared during the early Asian session yesterday. When GBP was at 1.3440, we indicated that it “could rise to 1.3480.” We also highlighted that “a break above this level is not ruled out, but the next resistance at 1.3510 is likely out of reach.” GBP subsequently broke above 1.3480 and reached a high of 1.3503 before pulling back to close at 1.3472 (+0.44%). The pullback from overbought conditions suggests that instead of continuing to rise today, GBP is more likely to consolidate between 1.3445 and 1.3505.”

“1-3 WEEKS VIEW: Following our positive GBP view from late last week, we highlighted two days ago (03 Nov, spot at 1.3410) that “there is scope for GBP to test 1.3480.” Yesterday, GBP surpassed 1.3480, reaching a high of 1.3503. We continue to maintain a positive stance and now expect GBP to rise to 1.3530. That said, given the overbought short-term conditions, this level may not come into view so soon. Overall, only a breach of 1.3410 (‘strong support’ level was at 1.3385 yesterday) would indicate that 1.3530 is out of reach during this phase of advance.”