‘GBP/USD continues to consolidate at its 55 day ma at 1.2426, we maintain a negative bias but patience is needed. A close below here will introduce potential to the 1.2253 the 18th January low.’ – Commerzbank (based on FXStreet)
As was anticipated, the GBP/USD pair was able to reach the 20-day SMA on Thursday, however, was unable to maintain trade at its level, ultimately retreating and closing with a 28-pip rally. The Sterling is likely to post more gains, as that would reconfirm the Cable’s current consolidation trend today. The 1.2550 level is expected to be the ceiling, assuming the 20-day SMA will be overcome. Technical indicators, on the other hand, are unable to confirm the possibility of the positive outcome, as they are giving mixed signals. Another leg down is possible, but with the 1.2460/40 area, a strong psychological support, remaining intact.
Today 59% of traders are long the Pound, compared to 61% on Thursday. The buy and the sell order ratio is now equal to one.