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"On balance the minutes should ease recent sterling weakness somewhat, but we prefer to keep longer positions through euro/sterling shorts."
- Citi (based on Reuters)
Pair's Outlook
An attempt of the bulls to negate the selling pressure at 1.66 turned out to be fruitless, as all of the intraday gains were eventually negated and the bears remained in control of the market. And even though the monthly studies suggest the down-trend is about to come to an end, the Sterling has a low chance of starting a robust recovery before falling down to this year's low at 1.6250. There is also an important level at 1.6450—monthly S3.
Traders' Sentiment
Just as in EUR/USD, here the part of long positions is also increasing. The bulls now constitute 65% of the market (61% five days ago). However, the gap between the buy and sell orders is closing—it has fallen from 18 to 4 percentage points during the last 24 hours.
© Dukascopy Bank SA