© Dukascopy Bank SA
"It is possible that some investors and traders are taking some mild encouragement from the recent economic data, with stronger third quarter GDP and better (housing) data, although PMIs could suggest we are treading on water"
- FxPro (Based on Reuters)
Pair's Outlook
GBP/USD still resides in proximity of 1.6166/80, being underpinned by the 1.6086/47 zone. However, with each new day the chance of a decline increases, this should bring the price down to 1.5964/51 initially, with a potential subsequent dip to 1.5895, the 100-day SMA. Weekly perspective suggests the cable stays buoyant at least until the weekend.
Traders' Sentiment
Even though the percentage of bears has fallen sharply, the overall bias remains quite negative, since 68% of market participants hold on to short positions, whereas only 32% of traders expect the Sterling to gain in value. Judging by the distribution between buy and sell orders—49% to 51%, accordingly, some portion of indecision still remains.
© Dukascopy Bank SA