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"The short-covering rally in sterling/dollar has probably run its course. Further gains in the pound look tough, given all the worries about 'Brexit'."
- London-based spot trader (based on Business Recorder)
Pair's Outlook
The British Pound surprised with its performance for another day, as demand at the monthly PP was sufficient to cause the Cable to recover from its intraday low and edge 45 pips higher. The 20-day SMA remains the immediate support today, but is not strong enough to prevent the GBP/USD currency pair from declining if the bearish momentum prevails. The cluster around 1.4125, on the other hand, is likely to limit the losses, as technical studies suggest. However, we should not rule out the possibility of the bulls pushing the pair towards the first resistance area, located around the 1.44 major level.
Traders' Sentiment
Today 57% of traders hold long positions, compared to 56% on Monday. Meanwhile, the portion of orders to acquire the Sterling inched 7% points higher. The orders now take up 59% of the market.
© Dukascopy Bank SA