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"There are signs of recovery in the UK, but the euro zone economy is shrinking and that will dent business confidence and hamper sterling"
- Western Union Business Solutions (based on Reuters)
Pair's Outlook
The cable carried more upside potential than EUR/USD, but too gave in to bears and is currently trading lower than today's open price. The closest support could be found at 1.5879, although a more deeper bearish correction, down to 1.5857/43, is likely to be required for the market to regain interest in the Sterling. Nonetheless, GBP/USD overall is bearish, as we move down from the major down-trend resistance line since Sep 28, while support of the same magnitude will be encountered only around 1.5653.
Traders' Sentiment
The difference between the shares of bulls and bears on GBP/USD has sharply narrowed, resulting in the sentiment of market participants becoming neutral towards the pair. The same situation is observed with orders placed, as 51% of them are to buy and 49% are to sell the British Pound.
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