18 Aug 2009

GBP/USD Analysis:
AN ugly start of the week with Asia, Europe and US market all recorded selling pressure in their equity market. With such an happening, traders then to flock back to the USD and the yen. As a result, throughout the day was a selling for the pound and the Eur.

Today at 1630hrsSGT, UK will announced CPI, which is predicted to slow down from 1.6% to 1.5%.

On the technicals, CCI is on the way down with no sign of reversal yet. Pound hit EMA55 at support yesterday, hitting a low at 1.628.

There may be some retracement today with resistance at 1.648/1.65 region. The next hight will be 1.654. Breakout thorugh 1.654 may signify pound back in a bullish state, but in the meanwhile is about shorting.

Support may easily break at EMA55 at 1.630, meaning pound will go lower towards 1.620 and potentially 1.60 region.

Trend: Down with lack of better than expected news. Some form of retracement for the pound may take place, before deciding pound to move further up or down.

A good play will be to wait for pound to retrace back to 1.65 before going short or to wait for pound to hit 1.62 for a rebound up. Its a bit difficult to state the direction for today as pound is now in a state of dispersion, meaning it now dangles in between the EMAs.