{"id":3112,"date":"2009-07-28T12:55:33","date_gmt":"2009-07-28T17:55:33","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=3112"},"modified":"2009-07-28T12:55:33","modified_gmt":"2009-07-28T17:55:33","slug":"gbpusd-rejected-by-our-3rd-tier-downtrend-line","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2009\/07\/28\/gbpusd-rejected-by-our-3rd-tier-downtrend-line\/","title":{"rendered":"GBP\/USD Rejected by our 3rd Tier Downtrend Line"},"content":{"rendered":"

By Fast Brokers<\/strong> – The Cable is gaining back some earlier losses, bouncing off of our 2nd tier uptrend line after being rejected by our 3rd tier downtrend line once more.\u00a0 However, the Pound is experiencing some relative strength despite the weaker than expected realized sales data from the CBI.\u00a0 Today\u2019s CBI number caught us a bit off guard since retail sales came in better than expected last week.\u00a0 At least the CBI reading logged a slight improvement from last week\u2019s release.\u00a0 The Cable is under immediate-term downward pressure along with the EUR\/USD as investors react negatively to the mixed 2nd quarter earnings and economic data from today.\u00a0 The S&P futures are halting their precipitous rise as the mixed news gives investors an excuse to take some profits from last week\u2019s run.\u00a0 The Cable is following U.S. equities lower due to their positive correlation.\u00a0 However, the GBP\/USD\u2019s uptrend is intact as is the EUR\/USD\u2019s.\u00a0 The Cable remains above our 2nd tier uptrend line with 7\/27 lows and our 1st tier uptrend line ready to defend should they be called upon.\u00a0 Furthermore, the GBP\/USD hasn\u2019t experienced any heighted activity on the sell-side thus far today, so investors should keep an eye on volume.<\/p>\n

Despite today\u2019s resilience in the Cable, Friday\u2019s much weaker than expected GDP from Britain spooked Cable investors a bit, negating progress made by higher retail sales and mortgage approvals data.\u00a0 However, sentiment concerning the GBP\/USD could improve as the week progresses since Britain should continue to show positive progress in unemployment and pricing.\u00a0 Therefore, the discouraging GDP figure could be brushed aside for the time being.\u00a0\u00a0 Upside movements in the Cable could be limited with the S&P futures approaching their highly psychological 1000 level.\u00a0 It\u2019s interesting that neither the GBP\/USD nor the EUR\/USD participated in Thursday\u2019s key breakout to the upside in U.S. equities.\u00a0 The Cable\u2019s lack of correlation could indicate an immediate-term downward tendency, and it may take a 1000+ S&P for the GBP\/USD to crack June highs.\u00a0 Hence, with 1000 looming overhead and the S&P surging 11% last week, U.S. equities may have overheated.\u00a0 If this is the case, the Cable would likely follow a pullback in the S&P.<\/p>\n

Britain will release net lending data tomorrow, and investors will look to see if banks are letting more liquidity flow to small businesses and individuals.\u00a0 Altogether, the GBP\/USD\u2019s uptrend is healthy despite today\u2019s setback.\u00a0 Unfortunately for the bulls, the Cable\u2019s battle with the psychological 1.65 area lives to see another day.\u00a0 The GBP\/USD should continue to log limited gains until 1.65 and our 3rd tier downtrend line are overcome.<\/p>\n

Present Price: 1.6439<\/p>\n

Resistances: 1.6441, 1.6467, 1.6500, 1.6542, 1.6555<\/p>\n

Supports: 1.6405, 1.6372, 1.6347, 1.6324, 1.6301<\/p>\n

Psychological: 1.65<\/p>\n

\"\"<\/a><\/p>\n

Market Commentary<\/strong><\/em> provided by Fast Brokers<\/strong><\/span><\/a>.<\/p>\n

Disclaimer:<\/strong> FastBrokers\u2019 market commentary is provided for information purposes only and under no circumstances should be regardedneither as an investment advice nor as a solicitation or an offer to sell\/buy any financial product. FastBrokers assumes no responsibility or liability from gains or losses incurred by the information herein contained.<\/p>\n

Risk Disclosure:<\/strong> There is a substantial risk of loss in trading futures and foreign exchange. Please carefully review all risk disclosure documents before opening an account as these financial instruments are not appropriate for all investors.<\/p>\n","protected":false},"excerpt":{"rendered":"

By Fast Brokers – The Cable is gaining back some earlier losses, bouncing off of our 2nd tier uptrend line after being rejected by our 3rd tier downtrend line once more.\u00a0 However, the Pound is experiencing some relative strength despite the weaker than expected realized sales data from the CBI.\u00a0 Today\u2019s CBI number caught us … <\/p>\n

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