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"There is a bout of short covering which is pushing sterling higher against the dollar. The U.S. durable goods data prompted some to cut longs in the dollar and there is talk that the Fed may postpone rate hikes."
- a spot trader (based on Reuters)
Pair's Outlook
Not only did GBP/USD break the weekly PP, it also jumped over a cluster of resistances at 1.5168/45 (weekly R1, monthly S3 and 20-day SMA). Accordingly, the bulls may well push the price even higher, up to 1.53, where the seven-month down-trend coincides with the monthly S2 level. There the current bullish correction should come to a halt, otherwise the medium-term bearish outlook for the Sterling will no longer be valid.
Traders' Sentiment
Just like yesterday, a majority (58%) of the SWFX traders holds Pound-long positions. On the other hand, there are now significantly less commands to sell the Sterling against the US Dollar than 24 hours ago, their share plunged from 66 to 53%.
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