UOB’s economists said GBP/USD remains positive in the short term after moving above 1.3450. They said the Pound could move towards 1.3520, but only if it records a daily close above 1.3480.
They noted that GBP reached 1.3485 before pulling back. They also said the short-term rally had looked overdone when spot was 1.3400 on 08 Apr, and later reiterated the need for a close above 1.3480 when spot was 1.3390 on 09 Apr.
Short Term Technical View
They raised the “strong support” level to 1.3330 from 1.3280. They said the chance of a close above 1.3480 remains as long as support holds.
For intraday trade, they expected a range of 1.3390 to 1.3465. The article stated it was created using an AI tool and reviewed by an editor.
This time last year, in April 2025, we saw a cautiously positive short-term outlook for GBP/USD. We were looking for a daily close above 1.3480 to confirm a potential move toward 1.3520. The strong support level had just been raised to 1.3330, indicating a fragile but present upward bias.
Fast forward to today, April 10, 2026, and the environment is entirely different, with the pair trading much lower around 1.2550. This significant decline over the past year reflects diverging economic paths between the UK and the US. The Federal Reserve has maintained a more hawkish stance than the Bank of England, strengthening the dollar.
Options Positioning Outlook
Recent statistics support the current weakness in the pound. The latest data from the Office for National Statistics (ONS) shows UK inflation, while falling, remains sticky at 3.1%, complicating the Bank of England’s decision-making on rate cuts. In contrast, US inflation has shown more consistent signs of cooling to 2.8%, giving the Fed less immediate pressure to ease policy.
For derivative traders, this suggests a bearish to neutral outlook in the coming weeks. Buying put options with strike prices below the 1.2500 psychological level could be a prudent way to position for a potential break lower, especially with UK GDP growth forecasts for 2026 revised down to a sluggish 0.5%. This strategy offers a defined risk if the pound unexpectedly rallies.
Alternatively, for those who believe the pair will stagnate as markets await clearer signals, selling out-of-the-money call options above the 1.2700 resistance level could generate income. This strategy profits from time decay if the pound fails to gather any significant upward momentum. The CBOE British Pound Volatility Index (BPVIX) remains moderately elevated, suggesting that option sellers can still collect a reasonable premium for taking on this risk.
