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"The UK should receive inflows as investors rotate funds away from the euro zone and into other European destinations. UK austerity plans are on track, while PMIs remain expansionary"
- Morgan Stanley (based on Reuters)
Industry outlook
GBP/USD is currently weakening and may dip down to 1.6050 or 1.5954. However, this is viewed as a very short-term development before the bullish bias is reignited once again. Thus the long-term targets are at 1.6425 and 1.6570.
Traders' sentiment
Bears, which form 66% of the market, remain in dominant positions relative to bulls, who constitute a lesser part of the market - 34%.
Long position opened
FX market participants have put their take profit orders at the key resistance points of intraday trading. Some of the investors might close their deals at 1.6217 and 1.6248. The highest level is at 1.6299.
Short position opened
Major FX traders expect the price to test the initial support level at 1.6135. The breakout of this line will pave the way for the price to test S2 at 1.6084 and S3 at 1.6053.
© Dukascopy Bank