GBP/USD Value Outlook:
GBP/USD Value Forecast: Retail Merchants Assured Worst has Handed
September has seen the British Pound unravel as renewed Brexit uncertainty erodes confidence within the nation’s foreign money and fairness markets. After sliding from 1.3482 in early September to probe 1.2800 this week, sentiment surrounding GBP/USD has undergone an about-face however retail dealer positioning is starting to point out some merchants consider the worst has handed. With Brexit information due for launch and Cable resting on assist, the place do IG purchasers suppose GBP/USD is headed?
GBP/USD Value Chart & Shopper Positioning Knowledge
To make sure, IG consumer sentiment information reveals a current shift in web positioning as merchants transition from a bearish bias to a bullish one. The change in positioning follows the abrupt flip decrease as bulls safe a slight majority simply as GBP/USD probes attainable assist round 1.2800. Since retail merchants usually try and name excellent tops and bottoms, the uptick in lengthy publicity is reasonably unsurprising at this juncture. Additional nonetheless, days of losses could lead some merchants to consider the Pound is oversold.
of purchasers are web lengthy.
of purchasers are web brief.
No matter its technical particulars, uncertainty looms giant for the pair, as does occasion danger. Coupled with our contrarian stance on IG consumer sentiment information, calling for a restoration rally could also be presumptuous at this stage and GBP/USD seems to be weak to a continuation decrease. Thus, persistence could also be warranted for bulls till Brexit readability is delivered and occasion danger is diminished as Extended Brexit uncertainty seems to be to erode the British Pound additional.
GBP/USD Value Chart: Each day Time Body (February 2019 – September 2020)
Since assist beneath 1.2800 seems reasonably sparse, an extension decrease might see the pair tumble towards the 200-day transferring common – at present buying and selling round 1.2659 – because it grasps for help. Regardless of the eventual final result could also be, retail merchants have performed fairly the shift in current days, however it isn’t with out appreciable danger. Whereas the market awaits Brexit information, observe @PeterHanksFX on Twitter and test again at DailyFX.com for Brexit updates and evaluation.
–Written by Peter Hanks, Strategist for DailyFX.com
Contact and observe Peter on Twitter @PeterHanksFX