GBP/USD News and AnalysisBank of England’s Mann concerned by optimistic rate cut estimatesPost-FOMC rebound on the cards for GBP/USD?IG client sentiment mixed despite majority net-long positioningBank of England’s Mann Concerned by Optimistic Rate Cut EstimatesOne of the staunch ‘hawks’ within the Bank of England’s Monetary Policy Committee (MPC) is Catherine Mann and she has recently clarified why she no longer voted in favour of a hike. Mann is of the opinion that market expectations around rate cuts is too high, something that appears to be supporting the local currency.She has expressed that wage dynamics in the UK are stronger than in the EU and US which she suggests makes it hard to argue that the BoE would be ahead of both nations when it comes to interest rate cuts. Something the market would have been attentive to was the February inflation report which revealed an encouraging drop on the way to the Fed’s 2% target by mid-year.Learn the ins and outs of trading one of the most liquid forex pairs. GBP/USD:
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Post FOMC Rebound on the Cards for GBP/USD?The daily GBP/USD chart reveals an attempt to lift off the stern zone of support found at the 200-day simple moving average and the 1.2585 level that help up prices for large parts of early 2024 when prices exhibited a range-bound preference.Since spiking above the prior range, not for the first time either, GBP/USD heads back into familiar territory as the pair looks to recover from the sharp decline. 1.2736 is the next level of resistance should bulls take over from here. Sterling stands to benefit from a slightly weaker dollar at the start of the holiday-shortened week which also happens to be very quiet from a scheduled risk point of view with just PCE data scheduled for release on Good Friday.GBP/USD Daily ChartSource: TradingView, prepared by Richard Snow
of clients are net long.
of clients are net short.
Change in
Longs
Shorts
OI
Daily
-10%
16%
-1%
Weekly
11%
0%
6%
IG Retail Client Sentiment Mixed Despite Majority Long PositioningSource: TradingView, prepared by Richard SnowGBP/USD:Retail trader data shows 59.14% of traders are net-long with the ratio of traders long to short at 1.45 to 1.We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests GBP/USD prices may continue to fall.Read the detailed GBP/USD sentiment report to find out why recent changes in positioning has clouded the outlook for the pair from a contrarian view point.Positioning is less net-long than yesterday but more net-long from last week. The combination of current sentiment and recent changes gives us a further mixed GBP/USD trading bias.Stay up to date with the latest breaking news and themes driving markets by signing up to out newsletter below:
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— Written by Richard Snow for DailyFX.comContact and follow Richard on Twitter: @RichardSnowFX
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