- 54% of pending orders in the 100-pip range are to buy the pair
- 54% of traders are bearish on the Pound
- Important support lies near 1.3485
- Upcoming events: US Building Permits, US Current Account, US Housing Starts, US Import Prices m/m
The British Pound depreciated against the Greenback by 49 base points or 0.36% falling further to touch an intraday low at the 1.3483 mark, after the Bank of England's Governor Mark Carney delivered a speech on Monday.
Mark Carney provided no signs that could undermine the last week's BoE decision to keep key rates unchanged at 0.25%, but noted that the Central Bank would need to raise interest rates gradually and at a limited extent in the coming months given higher inflationary pressures and the lingering erosion of slack in the country's economy. The Bank of England's monetary stimulus withdrawal would be capable of returning inflation to its 2% target, down from the 2.9% registered in August.
US Building Permits
The economic calendar for September 19 includes various data releases from the Unites States of significant and intermediate importance, namely, the Building Permits, Housing Starts and Import Prices for the month of August at 1230GMT. In addition, the quarterly data on the US Current Account is likewise published at the same time.
GBP/USD falls as Carney speaks
As it was expected, a steady horizontal movement represented an anticipation of the speech that was delivered by Governor Carney yesterday. On the one hand, it did not let to the anticipated appreciation of the Pound.
But on the other hand, the plunge of the rate was expectedly neutralized by a combination of the 55-hour SMA and the monthly R2 at 1.3485. At the moment, the currency rate is not facing any resistance on its way up until the monthly R3, which is located at the 1.3701 level.
In contrast, the opposite direction contains a whole package of technical indicators, including the weekly PP and the approaching 100-hour SMA, which altogether form a combined support level. Accordingly, the Sterling is likely to continue to pave the path to the top.
Hourly chart
Following a reversal, the Pound halted at a support cluster formed by the 50.0% Fibo, the monthly R2 and the weekly PP circa 1.35. The given area provided a solid support for the rate and sent it for a surge early on Tuesday. The upside is restricted only by the monthly R3 at 1.3702, thus giving enough upside potential for this session.
Meanwhile, the rate reaching the 1.36 mark has confirmed once again the existence of a long-term descending channel. This might suggest that the pair is likely to fall in the long-term.
Daily chart
Market sentiment more bearish
The bearish sentiment is currently dominating the market, as the number of short positions is 54%. Meanwhile, 57% of pending orders are still to buy the Pound.
On the other hand, OANDA traders are bearish on the pair, as 63% of open positions are short (-2%). Traders at Saxo Bank are likewise bearish with 70% short positions (+3%).