‘According to our long-term fair value model G10 VALFex, the USD already looks quite overvalued vs SEK, EUR, JPY and GBP and that should limit any future gains.’ – Credit Agricole (based on PoundSterlingLive)
In the wake of formal beginning of Brexit the GBP/USD pair began sliding down, this was seen by yesterday’s bearish development when the Pound lost more than 100 pips. Despite being supported by the weekly PP, the 55 and the 100-day SMAs, the Cable is likely to edge lower again. The 1.23 major level is expected to be the bottom floor for today’s trading, even though technical indicators are giving bullish signals in the daily timeframe. Ultimately, the given pair has been consolidating between 1.1950 and 1.27 since October 2016, and this trading range still remains intact, with the Sterling headed towards the lower half, namely below the 1.23 mark.
Although not as strong as yesterday, but market sentiment remains bullish, now at 57%. The share of sell orders increased from 53 to 55%.