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- Chris Hare, Investec (based on Bloomberg)
Pair's Outlook
A more dovish tone from the BOE pushed the price further away from 1.3350 and below 1.32, which we expected to hold. Nevertheless, support at 1.31, which played an important role in the second half of July, remains intact, meaning that if not a full-blown recovery, there is likely to be at least an upward correction to 1.32. Even in case 1.31 is broken, there is still a massive demand area between 1.29 and 1.28, where the monthly S1 merges with the July low and the lower bound of the two-and-a-half-year-old channel.
Traders' Sentiment
The market remains divided on where the Cable is headed, being that 50% of traders and long and 50% are short. In the meantime, the share of sell orders keeps increasing: compared to the yesterday's figure it grew from 60 to 66%.
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