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"There is a powerful case for more stimulus in the short run. A recovery in the UK, albeit modest, is underway ... (but) growth is not yet strong enough to reduce the considerable margin of spare capacity in the economy. Nor is recovery at an adequate rate fully assured."
- Bank of England Governor (based on Reuters)
Pair's Outlook
Pair did not manage to recover to the monthly R1 at 1.552 after receiving a bearish impetus from the weekly PP at 1.5654. At the moment it is hovering above the Fibo 38.2% (January, 2013, to March, 2013, move). At the same time the 20-day SMA does not allow it to advance either. Pairs outlook is still rather negative and traders should focus on the 1.53 area. Short term rallies, as indicated by technicals, remain possible. In such case resistances would be at 1.557 and 1.565.
Traders' Sentiment
Bulls lost some ground in the market, 3% to be exact. However, they continue to hold enormous 71% of all open positions on the pair. Distribution of pending orders switched sides completely. Being in favour or the bears for some time, today 55% of them are set to go long on the pair.
© Dukascopy Bank SA