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- Morgan Stanley (based on PoundSterlingLive)
Pair's Outlook
Even weak US fundamental data on Friday was insufficient to trigger a GBP/USD rally, being that the pair erased all intraday gains and ended the day with a 34-pip loss. Today the Cable faces a relatively strong support area 1.2870, represented by the Bollinger band, the weekly and the monthly S1s. However, a much stronger demand area lies 100 pips lower, which is bolstered by a three-year support line, but the exchange rate is unlikely to fall that low just yet, due to lack of impetus. Nevertheless, technical studies suggest that another leg down is probable, as they are giving bearish signals in the daily timeframe.
Traders' Sentiment
Sentiment remains moderately bullish, with 67% of all open positions being long (previously 64%). At the same time, the share of orders to acquire the Sterling increased from 36 to 57%.
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