4 Oct 2007

News:
The Bank of England has announced that the interest rate has remain the same. Unlike the Fed that cut the rate, in order to ease the housing mortage woes, UK did not do so. And anyway, the attention to the credit market and the problem with Northern Rock has pass media attention.

Sterling would still be likely to weaken sharply if rates are cut as futures markets have certainly not priced this in. With the Bank of England did not do so, GBP jump up after the announcement of rate remaining at 5.75% by a 50 pips, then to another 50 pips.

US is announcing unemployment claims - but not likely to influence the movement of the GBP.

Therefore, with all things remain unchange, GBP with yesterday influence will contiune to inch up.


Stock Market:
The Europe stock market performed moderately with mix emotions. US made a slight inch up. Overall, thee showed no good indication which direction GBP is heading today.

Currency Bench mark:
Most of the makor currency has strengthen against the USD today, after the last fews days of weakening. The direction against USD may contiune.

Technical:
The 1 hour chart show sign of a continue strength for GBP to go up, with stron support from EMA100 and EMA200. Should EMA21 clear EMA55 and EMA100, the direction is sure.

However, the mix comes from the daily chart, Yes there is a rebound from yesterday, and the question is how high?

The first resistance line is 2.0430 (yesterday peak) and 2.0500 (Monday peak), with 2.0650 as the whole year peak.

Support is at 2.0355 (1hour EMA200) and a breakout south is at 2.0290 (after yesterday low, for the downward trend to contiune).