United Overseas Bank (UOB) strategists Quek Ser Leang and Lee Sue Ann highlight that GBP/USD traded sideways on Monday, closing slightly lower near 1.3225, with intraday price action lacking clear momentum. They expect near-term range trading to persist. On a 1–3 week basis, they maintain a mildly negative Pound view, looking for a drift toward the major 1.3140 support, while longer-term technicals still point to further downside risk toward prior lows.

Pound range but downside risk

"24-HOUR VIEW: GBP dipped to 1.3184 and then rebounded to a high of 1.3256 last Friday. When it was at 1.3245 yesterday, we indicated that “while there is scope for the rebound to extend, given that there has been no clear increase in upward momentum, any advance is likely to remain within a 1.3215/1.3265 range.” The subsequent price movements did not unfold as expected. GBP fluctuated between 1.3191 and 1.3242 before closing modestly lower by 0.11% at 1.3224. There has been no clear shift in either downward or upward momentum. Today, GBP is likely to range-trade between 1.3195 and 1.3245."

"1-3 WEEKS VIEW: We turned slightly negative on GBP last Friday (02 Oct, spot at 1.3195). We indicated that “while downward momentum is building again, it is not strong for now.” We were of the view that GBP “is likely to edge lower toward the major support at 1.3140.” After GBP rebounded to 1.3256, we highlighted yesterday that “while the buildup has eased somewhat with the subsequent rebound in GBP, we will continue to hold the same view as long as the ‘strong resistance’ at 1.3265 is not breached.” There is no change in our view."

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