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"The inflation numbers were a little bit of a non-event, MPC minutes and retail sales will be the focus this week, and if the minutes are on the dovish side ... we could see sterling more vulnerable"
- BMO Capital Markets (based on Reuters)
Pair's Outlook
The cable has revealed its strong correlation with EUR/USD by failing to sustain the rally above the bearish line, changing its direction just ahead of the 16-month high (1.6308). Nevertheless, bulls should not necessarily give up, as the currency may still take off from 1.6153/33 after the forced correction due to an overextended rise this month. On the other hand if this support does not withstand, the outlook will be changed to negative.
Traders' Sentiment
An overwhelming majority of SWFX marketplace traders (74%) stay in favour of a softer Sterling, which is continuously losing its attractiveness across the board, on average being acquired in 34% of cases in its crosses. The ratio between buy and sell orders is 47% to 53%, accordingly, adding weight to neither of the sides.
© Dukascopy Bank SA