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CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

GBP/USD: Pound underperforms for the third consecutive session

Technical overview shifts as both weekly and daily show more volatile tendencies.

GBPUSD Source: Bloomberg

GBP/USD Technical analysis, overview, strategies, and levels

The pound has been in focus as of late given the wild swings experienced here with the move towards 1.35+ undone in three days of significant retracement that has tested its previous technical overview of an initializing bull trend that was initiated on fundamental news following last week's UK parliamentary elections. That means the recent moves we've been seeing have less to do with technicals and more based on the latest updates. In terms of data, UK CPI (Consumer Price Index) figures showed an unchanged 1.5% reading, ahead of today’s BoE (Bank of England) set to announce its monetary policy whereby no changes are expected.

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GBPUSD TA Source: IG charts
GBPUSD TA Source: IG charts

IG client and CoT sentiment for GBP/USD

Going into today's event retail traders are holding a heavy long 67% bias, while larger speculative traders as per last Friday's CoT (Commitment of Traders) report are holding a moderate majority short 59%.

GBPUSD sentiment Source: IG charts
GBPUSD sentiment Source: IG charts

GBP/USD Chart with retail and institutional sentiment

GBPUSD chart Source: IG charts
GBPUSD chart Source: IG charts

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CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

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