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"The PMI reading was better than expected and that has helped sterling. But with the dollar recovering broadly, we think the pound's gains in the short term against the dollar will be capped."
- Credit Agricole (based on Reuters)
Pair's Outlook
Although GBP/USD is supposed to move south, being that is has recently broken out of the bullish channel to the downside, the 100-day SMA continues to keep the pair afloat. Still, there is a higher possibility the Pound is going to breach the support at 1.6721 than a rally beyond the cluster at 1.6813/1.6776, consisting of the monthly PP, 55-day SMA and rising trend-line. Therefore there is likely to be a dip down to the 200-day SMA at 1.65.
Traders' Sentiment
Just as in EUR/USD, the market is currently almost equally divided between those who expect the Sterling to gain value (48%) and those who expect the opposite (52%). But there is a difference between the amounts of buy (42%) and sell (58%) orders.
© Dukascopy Bank SA