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GBP/USD Analysis: Continues To Consolidate

‘Altogether we remain constructive on GBP and remain long via a basket of USD, EUR and AUD. We remove EUR/GBP upside from our 2017 forecasts and expect GBP/USD to test 1.37 by year-end.’ – Nomura (based on FXStreet)

Pair’s Outlook

The GBP/USD currency pair underwent another decline on Thursday, driven mostly by weak fundamental data from the UK. However, the decline helped to prolong the consolidation trend, which began three weeks ago. It is yet uncertain whether the 1.28 or the 1.2850 level is the trend’s lower boundary, but the 1.30 mark is representing the upper one. As a result, the Cable still has room for another leg down, despite being supported by the weekly S1 and the 20-day SMA demand cluster just under today’s opening price. Meanwhile, technical indicators keep insisting that a positive development is due, but that is possible only if the US inflation data disappoints today.

Traders’ Sentiment

Traders retain a neutral outlook, with 51% of all open positions still being short. The number of sell orders inched up from 51 to 56%.

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This overview can be used only for informational purposes. Dukascopy SA is not responsible for any losses arising from any investment based on any recommendation, forecast or other information herein contained.

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