GBP/USD: More about USD than GBP
Both underperformed yesterday in the FX market, but the variance could rise with tonight’s Fed event.
GBP/USD Technical analysis, overview, strategies, and levels
Technicals are less relevant on a day of fundamental data and events, and since there are only low-impacting items out of the UK, it's the USD aspect of this pair that could get volatile with not just preliminary GDP (Gross Domestic Product) for Q1 with expectations for big contraction, but the US Federal Reserve’s monetary policy announcement thereafter, even if it's running low on additional financial firepower. That means its current technical overview that has started to show more positive bias will hold less relevance, and where pivot points could break enticing contrarian breakout strategies over conformist reversals.
IG client* and CoT sentiment for GBP/USD
Sentiment here is mixed with retail traders holding a rising majority long bias at 57% and institutional traders holding a slight majority short bias (as of last Tuesday’s figures).
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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