UOB’s Quek Ser Leang and Lee Sue Ann note GBP/USD dipped to 1.3407 on Monday before rebounding to finish almost unchanged at 1.3456. Intraday, they see the British Pound (GBP) confined between 1.3425 and 1.3485. On a 1–3 week view, earlier downside momentum has faded and price action is now seen as part of a 1.3390–1.3510 range, though a weekly close below 1.3300 would be more negative.

Pound consolidates after failed downside break

"24-HOUR VIEW: Yesterday, GBP dropped to a low of 1.3407 and then rebounded to close at largely unchanged at 1.3456 (+0.02%). The price action provides no fresh clues. Today, GBP could trade between 1.3425 and 1.3485."

"1-3 WEEKS VIEW: We turned negative on GBP last Thursday (28 May, spot at 1.3420). We indicated that it “could edge lower to 1.3370,” but we pointed out that “at this stage, it is unclear whether there is sufficient momentum for a continued decline below this level.” After GBP dropped to 1.3368 and rebounded, in our latest update from last Friday (29 May, spot at 1.3445), we highlighted that “while the likelihood of a continued decline below 1.3370 has diminished considerably, only a breach of 1.3480 (‘strong resistance’ level) would indicate that the downside risk has dissipated.” GBP subsequently broke above 1.3480 (high of 1.3485). Downward momentum has faded, and the current price movements are likely part of a range-trading phase between 1.3390 and 1.3510."

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