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"I doubt if we are done yet for the pound selloff. I sense there's a good chance for more downside."
- Neil Jones, Mizuho Bank Ltd. (based on Bloomberg)
Pair's Outlook
The Cable erased all daily gains on Tuesday, plunging towards the cluster around 1.4150, as the BoE Governor's remarks ruled out the possibility of an early interest rate hike. Today, however, we should see the Sterling rebound and retake the 1.42 level. A strong resistance cluster is located around the 1.44 level, also bolstered by the down-trend, but a surge that high is doubtful. At the same time, the weekly S1 is providing immediate support, whereas the monthly S3 is the level to prevent the pair from falling deeper; a breach of which could ultimately lead to 1.3505—the 2009 low.
Traders' Sentiment
Today 64% of traders are long the British Pound, compared to 63% yesterday. The portion of sell orders inched up from 63 to 68%.
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