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"Dollar long positions are being liquidated in the market at a faster pace than expected. It could face additional pressure if U.S. Treasuries are bought back on relief that the Fed's rate hike cycle will be quite a slow one."
- IG Securities (based on Reuters)
Pair's Outlook
The British currency experienced a rather sharp sell-off on Monday, amid remarks of the BoE official concerning poor nominal wage growth. Higher losses were prevented by the second support cluster around 1.5130, also keeping the pair afloat today during the Asian session. In case the weekly PP and 20-day SMA fail to support the GBP/USD, a slump towards the 1.5038 level, namely the weekly S1, could occur. On the Other hand, a retest of the down-trend at 1.5274 is possible if 55-day SMA resistance gives in and the fundamentals are in the Sterling's favour.
Traders' Sentiment
Bears keep outnumbering the bulls, as 56% of all positions are short. The portion of buy orders, however, remained unchanged at 51%.
© Dukascopy Bank SA