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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: Surges on greenback retreat

Retail bias shifts to the middle as longs take profit, focus may shift to Brexit talks.

GBP Source: Bloomberg

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

Risk-related currencies were in for big gains yesterday, and with the dollar in retreat it meant that GBP/USD's price surged higher. UK manufacturing PMI (Purchasing Managers Index) was as expected with a contracting 40.7 reading, and we'll get lending data today. The real focus moving forward however, will be on the resumption of Brexit talks, as well as whether USD weakness can persist. The technical overview is consolidatory when viewed in the context of its key technical indicators, but any fresh fundamental news means breakout strategies and a break of pivot points would be the conforming strategy as opposed to reversals that could get stopped out on an increase in volatility.

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GBPUSD TA Source: IG charts

IG client* and CoT sentiment for GBP/USD

Yesterday's surge was a real boon for retail traders whose majority long bias of 58% yesterday has shifted to the middle this morning, and where larger speculative traders have been hurt given their majority short bias.

GBPUSD sentiment Source: IG charts

GBP/USD Chart with retail and institutional sentiment

GBPUSD chart Source: IG charts

*The percentage of IG client accounts with positions in this market that are currently long or short. Calculated to the nearest 1%, as of today morning 8am.

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This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
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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