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"A weaker inflation number [in the U.K.] has prompted the argument that it removes the obstacle to further stimulus [by the BoE]. But it's hard to expect that to have an underlying impact on sterling"
- Lloyds (based on Reuters)
Pair's Outlook
Despite GBP/USD closing above 1.5650 yesterday, rally was not sustained, leading to a dip, which is expected to extend further and erase at least some of the gains made previously. Given that most of technical indicators give sell signals, the Cable is inclined to drop to an interim support at 1.5596/80. Further weakening of the British Pound will be hindered by a subsequent area at 1.5542/21.
Traders' Sentiment
Traders' sentiment is mixed towards the Cable, since the portions of long and short positions are equal - 50%, implying absence of consensus among market participants with regard to course the price will take. The situation with orders is largely unchanged, as most of orders are to sell the Sterling (61%) and 39% are to buy it against the greenback.
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