Dukascopy - Analytics

    Dukascopy

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    GBP/USD to bounce off of 1.44

    © Dukascopy Bank SA
    "Carney's conditions for raising interest rates -- which include growth looking strong enough to eliminate the remaining slack in the economy -- are probably still not met. The recovery still looks very unbalanced."
    - Capital Economics (based on Bloomberg)

    Pair's Outlook
    The Cable soared from 1.4230 yesterday and even punched through the resistance line at 1.4360, which was considered to be capable of stopping near-term rallies. Today, however, we are likely to see a downward correction, as the price has just hit not only a trend-line that connects Jan 18 and Jan 28 highs (better observed in the hourly chart), but also monthly S2 and 20-day SMA. GBP/USD might stabilise near 1.4360, but it also would not be surprising for the Sterling to descend down to 1.43 dollars.

    Traders' Sentiment
    A small part of traders decided to square off bullish positions—the percentage of longs fell from 65 to 63%. Meanwhile, there is still no real difference between the buy (46%) and sell (54%) orders.

    © Dukascopy Bank SA

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