Jul
29
2010
29
2010
GBP/USD Fluctuates Following Sluggish UK Data
The Cable is fluctuating today yet remains above its psychological. 1.55 level after nationwide HPI and net lending to individual figures both disappointed. However, investors should still keep in mind that last week’s prelim GDP leapt past estimates and the UK economy is growing stronger despite today’s data. Meanwhile, the dollar is taking a hit today after Fed official Bullard implied that the central bank is ready to inject more QE if there is another negative external shock in the global economy. The Fed’s persistent dovishness is encouraging for the Cable, particularly since UK CPI is still over 3% and Sentence is pushing for a 25bp rate hike. Although the UK will be quiet on the data wire tomorrow, the Cable could still be active since the U.S. will release prelim GDP along with a host of other data. That being said, a relatively calm trading week could come to an active close. Meanwhile, the Cable is still locked into its uptrend as are the EUR/USD and Aussie.
Technically speaking, the Cable has multiple uptrend lines serving as technical cushions along with intraday and 7/27 lows. Additionally, the highly psychological 1.55 level now becomes a psychological cushion. As for the topside, the Cable faces technical barriers in the form of intraday highs.
Present Price: 1.5621
Resistances: 1.5627, 1.5656, 1.5679, 1.5701, 1.5721, 1.5745
Supports: 1.5598, 1.5573, 1.5543, 1.5520, 1.5503, 1.5470
Psychological: 1.55
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Posted by: Matthew Myers
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