GBP/USD: Surges on greenback retreat
Retail bias shifts to the middle as longs take profit, focus may shift to Brexit talks.
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.
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.
GBP/USD Chart with retail and institutional sentiment
*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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