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"If there was a Brexit scenario, the market is considering the probability that could provide another headwind to growth in the UK and could result in lower rates from the Bank of England later this year."
- Bank of Tokyo-Mitsubishi UFJ (based on Business Recorder)
Pair's Outlook
The British currency started the week with a rather serious decline, but with the support line untested. Technical indicators are shifted from bullish to mixed signals in the daily timeframe, suggesting a possibility of a bearish reaction today exists. The up-trend is reinforced by the monthly PP, the weekly S1 and the 20-day SMA, thus, we should not see a more than 50-pip slump; unless inflation data disappoints dramatically. Meanwhile, the weekly PP is the closest resistance, but is unlikely to provide sufficient supply and limit the gains.
Traders' Sentiment
Today 60% of all open positions are long, compared to 53%. At the same time, the number of purchase orders surged from 47 to 65%.
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