GBP: Range Trading for Now, Likely to Test 1.3700 Against USD – UOB

GBP/USD is currently trading around 1.36368, maintaining an overall range-bound pattern. UOB FX strategists Quek Ser Leang and Lee Sue Ann noted in their latest report that after the pair touched 1.3675 earlier, driven by overbought conditions, short-term movement has been confined to a narrow range of 1.3620 to 1.3665, exhibiting typical consolidation characteristics.

**Short-term momentum is positive, but upside is limited**

From a 1-3 week perspective, UOB maintains a positive stance, expecting GBP/USD to move toward the 1.3700 level. However, this optimistic outlook comes with a clear precondition—the pair must hold the strong support at 1.3585. A break below this level would signal fading upside momentum and a reversal of the current positive bias. Market reports show that GBP previously rose to 1.3712 before pulling back to 1.3610, indicating strong technical selling pressure above 1.3700.

**Longer-term signals point to broader range trading**

Despite short-term upside opportunities, UOB analysts emphasize that longer-term signals still favor a broader range-bound trading pattern. This means that even if the pair successfully reaches 1.3700, the likelihood of a sustained breakout and trend-following rally remains limited. According to the report's analysis, although GBP/USD has found some support after breaking through key resistance levels, intraday gains may be capped, with expectations for movement within the 1.3605 to 1.3670 range. Overall, the market is fairly balanced between bulls and bears at current levels, and investors should closely monitor the outcome at the 1.3585 support and 1.3700 resistance levels to determine the next directional move.