UOB group FX strategists noted Cable should continue to navigate a broad topic of short-term consolidation.
24-hour view: “Our view that the GBP would trade sideways between 1.2300 and 1.2490 last Friday was incorrect because the break at 1.2300 plunged it to a low of 1.2205. The downward pressure remains intact and for today, the risk is that the weakness of the GBP will continue towards 1.2150. The next support at 1.2100 is probably out of reach. Overall, the GBP is expected to remain under downward pressure unless it can return above 1.2320 (minor resistance is at 1.2260). “
Next 1-3 Weeks: “When the GBP surged to 1.2200 on March 27, we indicated that the” GBP recovery could extend higher, but the prospect of movement beyond 1.2550 is not high at this time. “The GBP subsequently extended its gain to 1.2484, traded sideways for several days before weakening last Friday (April 03), and nearly withdrew our level of” solid support “at 1.2205. While “solid support” is still intact, upward pressures have dissipated with abrupt and rapid decline. The immediate risk here is trending downward, but any weakness is considered part a wide range of 1.1950 / 1.2420 (a sustained drop below 1.1950 is not expected). ”