GBP/USD Analaysis:
It will be a quiet morning with Japan and most of S.E Asian market on holiday. Euopre will too be trading thinly with no major news for the day.
Two news emerged during the weekend. One for the explaination why the pound fell because of fears over the parlous state of the public finances may have helped trigger a stampede away from the pound, Bank of England analysis suggested. The other a positive news on UK housing from Bloomberg, U.K. home sellers raised asking prices in September as confidence in the property market improved and the supply of homes dwindled, Rightmove Plc said.
As such movement of the pound for today will be again based strongly on technicals, as no major news to trigger it in any possible direction.
With a drop below 1.63, it is suggested that the pound will continue to lost ground and hit support line at 1.616, then 1.608.
A likely movement will be for the pound to hit support at 1.616 then rebound to gain 1.629. A break at 1.629 will bring the pound in the up trend towards 1.64.
Trend: There are no clear indication from CCI, which suggest a possible down movement, pending reversal up.
As such, you can trade long at 1.616, SL at 1.608 and TP at 1.629. If you are more daring, do a short now, TP at around 1.616 and 1.608, SL at 1.629. You can also do a short at 1.629, TP at 1.616, TP at 1.64.
Do take profits whenever possible as I expect the market to range between 1.629 and 1.616.
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