GBP/USD retests the 20-day SMA from above

GBP/USD retests the 20-day SMA from above

"The upward momentum in confidence, if sustained, would point to a return to growth in the early stages of 2013, though external risks remain" - Loyds Bank (based on Bloomberg)

Pair's Outlook

Christmas and the New Year's brake reduced volatility of the major pairs, especially GBP/USD, since the price fluctuates for the second consecutive week around the 20-day SMA. Currently the price is in the upper side of the Bollinger channel and is slipping to retest the 20-day SMA from above. Since all technical indicators reversed from the critical values, the second part of the week should prove to be better for more rational trades.

Traders' Sentiment

Bulls lose their positions in the GBP/USD pair, as the buy side reduced to 26% and the sell side expanded its share to 75%. Pending orders segment gradually turns to neutral, since 47% are buy orders and 53% are sell orders.