GBP/USD interim low in place? – UOB

In opinion of the research team at UOB Group, the current upside momentum in GBP/USD could prompt traders to think that an interim low is in place.

Key Quotes

“GBP made gains after confirmation of Theresa May as PM designate, with the GBP/USD pair touching an intraday high of 1.3018 overnight. Whilst the removal of weeks of uncertainty could be good for a short term bounce, we think that price action would now be driven by Thursday’s BoE’s decision, at which expectations vary between no rate move and a 50bps cut, with our call being for a cut of 25bps to 0.25%”.

“We highlighted that downward momentum has weaken in the past few updates and from here, the risk of an interim low is growing. Those who are shorts after Brexit may like to book partial profit at current level. Stop-loss is adjusted lower to 1.3100 from 1.3150”.