Dukascopy_Analyst

GBP/USD forms falling wedge from Thursday's surge

FX:GBPUSD   British Pound / U.S. Dollar
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"It is still easier to support the dollar as the story is no longer just about the Fed hiking rates, but how frequently they could continue to tighten policy."
- State Street (based on Reuters)

Pair's Outlook
The US Dollar experienced a harsh sell-off on Thursday, mainly caused by the ECB's unexpected stimulus decision, as well as a set of weak US fundamentals. As a result, the Cable skyrocketed, meeting resistance only in face of the third cluster at 1.5145, namely the 20-day SMA and the weekly R1. A correction is likely to take place today, forcing the GBP/USD to drop below 1.51, with the target support located at 1.5088 in face of the weekly PP . However, disappointment in the US employment sector could trigger a rally, causing the Sterling to return above the 23.60% Fibo.

Traders' Sentiment
Although the share of bulls remains unchanged at 56%, the portion of orders to buy the Pound added 38 percentage points up to 72%.

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