2 Dec 2016

2 Dec 2016

The pound climb above the resistance level at 1.256 after Brexit Minister Davis comment. iT continue to spur up after ECB favors QE extension till next March. It hit a high of 1.269/1.270

But news from the US with crude making high, brought the pound back to 1.258, which make 1.256 the support.

What has crude high prices do with the US or the UK economy? Nevertheless, the US also followed by better than expected data from ISM manufacturing (Institute of Supply Management Level of a diffusion index based on surveyed purchasing managers in the manufacturing industry  ).

Looking at today news - UK construction PMI at 1730 SGT and US Unemployment rate at 2130 SGT. US unemployment claims increase, but dollars does not means the increase in number of unemployment. At the same time US is reporting non-farm employment change.

The December Fed rate has point to an increase which means the data in US are getting better.

Looking at the day chart CCI, the pound has been over bought, it has indicate a downtrend. The resistance is at 1.282 (EMA100), with the price now hovers above at EMA55 with WMA5 below EMA55 (yet to break).

The price now is at 1.26. If it break the support level, I am expecting the price range between 1.256 and 1.248. given that WMA5 failed to punch through EMA55.

On the other hand if WMA5 punch through EMA55, support will be at 1.26 and resistance at 1.282 (EMA200).

Given the over bought CCI indicator, the pound may weaken against USD, returning to support at 1.248/1.244 level.