GBP/USD: Technical overview gets tested
Stronger PMIs and reopening plans help the pound best the weakened greenback.
GBP/USD Technical analysis, overview, strategies, and levels
Preliminary manufacturing and services PMI (Purchasing Managers Index) figures out of Markit for the UK didn't just beat expectations, but showed expansion on the previous month for the former with a 50.1 reading and a 47 reading for its services sector. There was also the government's July 4th plan to reopen the economy. With the US dollar weakening in the FX market, the pound didn’t need to outperform against most of the FX majors to take GBP/USD’s price higher to cross and close above its 100-day moving average, even if it was in for a partial retracement off the highs that aided sell reversal strategies. Its bear trend technical overview on the daily needs little to shift at this stage, with most of its main indicators neutral, a trending ADX (Average Directional Movement Index), and a positive DMI (Directional Movement Index) cross occurring yesterday.
IG client* and CoT sentiment for GBP/USD
Retail long bias has dropped to just 54%, not that far off from shifting to majority short.
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.
Be sure to request IG’s Weekly & Daily Market Report when you open an account with IG Dubai and get access to the full information on the FX majors, commodities, indices, and Bitcoin.
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.
See an opportunity to trade?
Go long or short on more than 17,000 markets with IG.
Trade CFDs on our award-winning platform, with low spreads on indices, shares, commodities and more.
Live prices on most popular markets