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"There's a partial argument that sterling is benefiting from what is going on in the euro zone but this is tempered by the fact there are decent expectations we will see something in the way of more QE from the BoE"
- FxPro (based on Reuters)
Pair's Outlook
Breakout of a tough support level at 1.5787 signifies considerable bearish momentum the Cable currently possesses. Accordingly, our favoured scenario is continuation of a fall, which should ultimately lead to an attainment of 1.5263/59. However, the currency pair will have to overcome a number of supports that will be encountered along the way downwards and may somewhat hamper the move, they may be found at 1.5616, 1.5550 and 1.5427.
Traders' Sentiment
Based upon SWFX liquidity consumer sentiment index, we may conclude that the stance of market participants is presently mixed, as 46% of traders remain bullish on the pair and 54% of them stay bearish on it. On the other hand, two thirds of orders placed within 200 pips from the current price are sell orders, thus we may possibly observe an increase of bearish positions soon.
© Dukascopy Bank SA