Sterling pushed and pulled by USD & Euro

Share On Facebook

With the high drama and emotion surrounding the Scottish Referendum now over, the British Pound too has recovered a measure of stability, particularly against the US dollar following its dramatic gap down the weekend of the rogue poll which suggested a win for Alex Salmond and the yes campaign.

Since that weekend cable has managed to manage to fill the gap down to touch a high of 1.6524 before resuming its slide lower, although it has yet to touch the low of early September in the 1.6051 region, which also corresponds with a major price support line on the monthly chart.. This recent price action also puts cable firmly below the 200 moving average on this chart.

With the market now expecting a rise in interest rates as early as Q1 2015, the question is whether this support platform will provide the springboard for cable to higher, or is merely the start of a further sell off. The candles on the daily chart favour a continuation of the current bearish tone, but Tuesday’s doji candle on high volume suggests a possible pause and minor reversal. As always we must also look to the US dollar which continues to remain strong and which is adding its own pressure.

Meanwhile, against the euro the pound has seen some dramatic gains with the eurgbp falling to a low of 0.7766, a price region not seen since July 2012. In this case it is more a question of the euro weakness rather than pound strength driving this pair at present. Should the 0.7766 level be breached then we could even see a deeper move towards the 0.7246 region where on the monthly chart the 200 moving average awaits along with a further developed platform of support.

 

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

This area of the ADVFN.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ADVFN.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.

Leave A Reply

 
Do you want to write for our Newspaper? Get in touch: newspaper@advfn.com

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V: D:20190916 04:05:22