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"There is a structural worsening of the UK economy. But we are also expecting the Fed to act in the near term and that should weigh on the dollar and support cable"
- Rabobank (based on Reuters)
Pair's Outlook
Prolonged bearish correction extended the dip of the cable down to 1.5796/77, but appears to be already terminated, being that the pair commences recovery. The initial resistance it should encounter is situated at 1.5824, while subsequent levels are to be found at 1.5873 and 1.5915. Still, despite short-term bullish outlook, in the long-term GBP/USD is deemed to be bearish.
Traders' Sentiment
The share of bearish market participants has declined, though the overall sentiment remains negative, since the portion of short positions is 69%, whereas the long ones form only 31% of the market. On the other hand, distribution between buy orders (53%) and sell orders (47%) does not support current stance of SWFX traders.
© Dukascopy Bank SA