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"The biggest factor behind the dollar's recent rebound is trust in the U.S. economy being resurrected. Reviving expectations for a rate hike by the Fed is a key factor to halt the dollar's recent depreciation."
- FPG Securities (based on Reuters)
Pair's Outlook
Strong US GDP figures caused the Cable to retreat from its daily high of 1.4045, ultimately falling to the lowest in six years. According to technical studies, the given pair is likely to undergo another sell-off, with the immediate support in face of the Bollinger band doubtfully limiting the losses. Consequently, the GBP/USD currency pair's price could fall below the 1.38 level, with the second support area located only around 1.3680. Meanwhile, the monthly S1 and the weekly PP form a rather strong resistance cluster circa 1.3980, in case bulls manage to push the Sterling higher against the Buck.
Traders' Sentiment
SWFX traders' sentiment remains bullish, now at 65%, compared to 63% last Friday. At the same time, the number of orders to acquire the British currency added three percentage points, surging up to 58%.
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