Dukascopy - Analytics

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    GBP/USD on the edge of breaking 23-month down-trend

    © Dukascopy Bank SA
    "It feels like the market is priced more in line with the betting odds, with a modest relief rally likely to ensue on 'Remain' and a serious downward market correction for risk assets on a "Leave" vote."
    - BNZ (based on WBP Online) 


    Pair's Outlook 
    Ahead of the EU referendum the Pound managed to appreciate against the US Dollar for another day yesterday, but still unable to pierce the 23-month down-trend. Everything now depends on the ‘Brexit' poll results, but from the technical point of view, a ‘Brexit' is more probable, as the Cable would then reconfirm the down-trend. Consequently, a drop beyond the 1.45 mark could take place, unless demand around that area, represented by the weekly R1, the monthly PP, the 20 and the 55-day SMAs, is strong enough to limit the losses. On the other hand, ‘Bremain' outcome might lead to a strong rally, with the exchange rate even climbing over the 1.50 major level today. 

    Traders' Sentiment 
    Market sentiment is bearish at 58%, whereas the portion of orders to purchase the Sterling takes up 57% of the market.
    © Dukascopy Bank SA

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