Chance for Pound Sterling (GBP) to break above 1.3000 vs US Dollar (USD); overbought conditions suggest it might not be able to maintain a foothold above this level. In the longer run, to continue to rise, GBP must break and remain above 1.3000, UOB Group's FX analysts Quek Ser Leang and Peter Chia note. 

Overbought conditions suggest GBP might not remain above 1.3000

24-HOUR VIEW: "Yesterday, we expected GBP to 'trade in a 1.2900/1.2970 range.' However, GBP soared, testing the major resistance at 1.3000, reaching a high of 1.2999. While the rapid rise appears overstretched, as long as 1.2955 (minor support is at 1.2970) is not breached, there is a chance for GBP to break above 1.3000. Given the overbought conditions, it might not be able to maintain a foothold above this level. The next resistance at 1.3050 is unlikely to come under threat." 

1-3 WEEKS VIEW: "We have held a positive GBP view since early this month. Tracking the advance, in our latest narrative from last Thursday (13 Mar, spot at 1.2955), we indicated that 'to continue to rise, GBP must break and remain above 1.3000.' Yesterday (17 Mar), GBP tested the 1.3000 level but failed to break through. We continue to hold the same view. Looking ahead, the next level to monitor above 1.3000 is 1.3050. On the downside, the ‘strong support’ level has moved higher to 1.2930 from 1.2880 previously."

Source: Fxstreet