7 Dec 2016
The pound retreat after hitting 1.278, It did not meet the resistance at EMA100 at 1.283. The pound has been making new highs since surfacing from the level at 1.23. So the question is will this retreat be another retracement before making another high?
Today UK will report manufacturing production numbers at 1730 SGT and it will be quiet at the US side. This month to month report may favor forecast and report better than expected (because the forecast is 0.2% compare to last month at 0.6%). I am expecting 0.4-0.5%. based on the fact that a weak pound boost manufacturing.
Using a fib retracement from 1.23 to 1.278, the pound has a potential to retreat to 1.26 then 1.253. This is also supported by EMA55 (1.26) and EMA21 (1.253).
On the up side, 1.278 and 1.283 offer a strong resistance. I am not expecting the resistance to be broken today.
CCI continue to support a down side movement, given potential for the pound to retreat to 1.26 a likelihood.
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