© Dukascopy Bank
"The U.K. economic backdrop may not be brilliant, but it's enjoying a haven status because of the political uncertainty in the euro zone"
- Morgan Stanley (based on Bloomberg)
Pair's Outlook
As anticipated earlier, the Cable was unable to breach a tough area at 1.6106/10 formed by a cluster of resistances and has already eroded a support at 1.6015/1.5998, implying increasing downside risk. GBP/USD now faces a string of formidable supports - 1.5895 and 1.5780, which are expected to give in eventually, paving the way towards attainment of 1.5257.
Traders' Sentiment
As SWFX sentiment index suggests, the portion of bearish traders is diminishing on GBP/USD and currently is 57% of the total amount of market participants. Concerning the orders placed 100 pips from the current price, a severe disequilibrium is observed, since four out of five commands are presently to sell the Sterling.
© Dukascopy Bank