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"For now, we stick to our view that BoE will hike in Q4 15 (most likely in November) but as mentioned above it depends on the development of inflation. Hence, we still project a significant rise in UK interest rates in the coming months."
- Danske Bank (based on FXStreet)
Pair's Outlook
The Cable sustained heavy losses on Thursday, as less-than-expected MPC members voted for an interest rate hike. As a result, the Sterling breached the three nearest supports and stopped falling at 1.5511, namely the weekly S1, close to the anticipated possible decline target. A correction is likely to take place today, as the weekly S1 appears to be providing rather strong support and technical studies keep giving bullish signals. Furthermore, the closest resistance, now the monthly PP, will doubtfully be reached, unless the US fundamentals disappoint too much.
Traders' Sentiment
Bulls keep retreating, as only 51% of all positions are long today. Meanwhile, the number of purchase orders slid from 58 to 56%.
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