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"I won't be getting bullish on the pound any time soon. A catalyst for the next leg lower in sterling against the dollar is absent at the moment. But I'm not sure the EU referendum debate is getting less toxic, and I'm certain the outcome is as unclear as it could be."
- Kit Juckes, Societe Generale (based on Business Recorder)
Pair's Outlook
The GBP/USD currency pair surprised with its performance on Wednesday, amid no further clues concerning the Brexit. As a result, the Cable surged 125 pips and reached a new one-week high, but uncertainty remain sin the market. The Pound still risks edging lower, as technical studies in all timeframes retain bearish signals. The weekly PP now acts as the closest support, although a sharper decline is possible, without, however, stretching beyond the 1.3830 mark—where the down-trend lies. On the other hand, the Sterling could prolong its rally if fundamentals support it, and even pierce the nearest resistance, namely the monthly PP and the weekly R1 around 1.4155.
Traders' Sentiment
Market sentiment shifted to the bearish side, with 60% of traders being short the GBP. The number of sell orders increased from 46 to 70%.
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