According to UOB’s Quek Ser Leang, GBP/USD stalled just below key resistance at 1.3465 and closed near 1.3410, with intraday momentum indicators turning flat. The bank still sees scope for a break above 1.3465, though 1.3490 remains a tougher barrier, and warns that a drop below 1.3380 would signal a return to broader range trading.

Pound capped near key resistance band

"Following the sharp rise in GBP early yesterday, we indicated that “the rapid rise has room to test the major resistance at 1.3465.” We added, “a break above this level is not ruled out but note that there is another resistance at 1.3490.” However, GBP did not quite test 1.3465 as it retreated from a high of 1.3460."

"Momentum indicators are turning flat, and GBP is likely to trade sideways today, probably between 1.3390 and 1.3450."

"Yesterday (15 Jun, spot at 1.3415), we indicated that “while the increase in momentum suggests GBP could break above 1.3465, based on the prevailing momentum, it is too early to tell if GBP can break above 1.3490.” We added, “to sustain the rapid increase in upward momentum, GBP must hold above the ‘strong support’ level, now at 1.3380.”"

"GBP subsequently rose but did not break above 1.3465. That said, we will continue to hold the same view."

"Looking ahead, a breach of the ‘strong support’ level at 1.3380 would indicate that GBP is likely to remain in a range-trading phase."

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