GBPUSD Analysis: Remains on the back foot
|"It is clear that there has been some reduction in stretched GBP shorts – yet the scale of this does not seem extreme either."
- Credit Suisse (based on PoundSterlingLive)
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Pair's Outlook
For the third consecutive day the Sterling declined against the American Dollar on Thursday, despite initial signs suggesting a rally. With the weekly PP getting pierced yesterday, the Cable now risks sliding deeper down, but with losses most likely limited around 1.25, as the weekly S1, the monthly PP, the two-month up-trend, the 20 and the 55-day SMAs form a strong demand area there. On the other hand, technical indicators keep suggesting the British Pound is to edge higher, unable to confirm the outlook. In case bulls do take over, the exchange rate is expected to remain below 1.2650. -
Traders' Sentiment
Traders' sentiment remains unchanged today, with 55% of all open positions still being long. Meanwhile, the number of orders to sell the Sterling increased from 58 to 62%.
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