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GBP/USD sets eye on 1.55

© Dukascopy Bank SA
"Given the rise in market forecasts regarding the likelihood of more ECB easing by year end, the BoE may be more likely to delay its first rate hike in order to prevent too much monetary tightening being transmitted via the exchange rate."
- Rabobank (based on FXStreet)

Pair's Outlook
Last Friday the Cable managed to erase all week's losses and even stabilise above 1.54, amid poor US fundamentals. Today the GBP/USD is expected to extend its rally, with the nearest resistance located around 1.5480, namely the 100-day SMA, which prevented the Sterling from climbing higher for three weeks in a row. In case of a breach, another solid supply is located at 1.5515. However, there is still room for the pair to edge back below 1.54, but a tough cluster, represented by the weekly and monthly PPs, the 20, 55 and 200-day SMAs, is likely to limit the losses circa 1.5360.

Traders' Sentiment
Bulls and bears broke out of equilibrium, with 55% of all positions now long. The share of purchase orders increased from 26 to 64%.

© Dukascopy Bank SA


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