{"id":5158,"date":"2009-12-08T11:55:44","date_gmt":"2009-12-08T16:55:44","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=5158"},"modified":"2009-12-08T11:55:44","modified_gmt":"2009-12-08T16:55:44","slug":"gbpusd-tests-november-lows","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2009\/12\/08\/gbpusd-tests-november-lows\/","title":{"rendered":"GBP\/USD Tests November Lows"},"content":{"rendered":"

By Fast Brokers <\/strong>– The Cable is testing its November lows as investor sentiment has turned sour following Friday\u2019s optimism stemming from a combination of encouraging U.S. employment data and the BoE\u2019s Darling stating that he believes the UK economy has turned a corner.\u00a0 We have since witnessed a risk-aversion trend since Friday\u2019s events as investors react to Bernanke stating that the U.S. economy still faces considerable headwinds.\u00a0 It seems Bernanke is trying to curb speculation that the Fed will begin tightening liquidity sooner than anticipated due to Friday\u2019s data.\u00a0 Bernanke\u2019s cautious public address has sent U.S. equities lower and the Dollar and Yen higher.\u00a0 In addition to Bernanke\u2019s impact on the market, investors are also reacting to Moody\u2019s statement that the UK and U.S. are \u2018testing the boundaries\u2019 of the Aaa ratings.\u00a0 Moody\u2019s statement has delivered a negative psychological blow to the risk trade as investors worry about the debt exposure of these two industrialized nations.\u00a0 Furthremore, investors are monitoring Dubai\u2019s debt situation as it seems Dubai World will need to delay its Dec 14th debt payment.\u00a0 New uncertainties surrounding Dubai World\u2019s ability to settle with its creditors has resulted in additional risk-aversion.\u00a0 Hence, the Cable has continued Friday\u2019s sell-off as the Dollar experiences a broad-based rally.<\/p>\n

Meanwhile, Britain released a Manufacturing Production figure which was 5 basis points below analyst expectations (0% vs. 0.5% expected).\u00a0 However, less weight is normally placed on the UK\u2019s manufacturing data since the nation\u2019s GDP is much more reliant on revenue from the services industry.\u00a0 In addition to today\u2019s disappointing manufacturing number, Britain\u2019s Retail Consortium\u2019s data showed that the growth of retail sales has slowed, led by a decline in the purchase of food products.\u00a0 Invetors are presently awaiting Finance Minister Darling\u2019s new budget plan to see how Darling plans to reduce the UK\u2019s swelling deficit.\u00a0 Most of the focus will likely be on Thursday\u2019s BoE monetary policy decision.\u00a0 The central bank has been a bit more hawkish concerning its monetary policy lately due to its more optimistic outlook on the UK\u2019s economic performance.\u00a0 Therefore, it will be interesting to see how investors approach Thursday\u2019s policy meeting.<\/p>\n

Technically speaking, the Cable is currently testing important near-term technical cushions in the form of November and 10\/26 lows.\u00a0 A failure of these lows could result in a test of our 2nd tier uptrend line.\u00a0 That being said, the Cable does have some historical data from August and September of this year.\u00a0 Hence, the Cable\u2019s technical condition may not be as poor as it seems from our 4-hour chart.\u00a0 However, should conditions deteriorate, the Cable\u2019s psychological 1.60 level could also prove to be a solid technical cushion should it be tested.\u00a0 As for the topside, the Cable faces multiple downtrend lines along with 12\/07 and 12\/04 highs.\u00a0 Therefore, quite a few topside technicals are in place.<\/p>\n

Present Price: 1.6285<\/p>\n

Resistances: 1.6325, 1.6346, 1.6371, 1.6396, 1.6435, 1.6470<\/p>\n

Supports: 1.6284, 1.6260, 1.6248, 1.6200, 1.6163, 1.6133<\/p>\n

Psychological: 1.65, 1.60, November Lows and Highs<\/p>\n

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

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

Disclaimer:<\/strong> <\/span>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> <\/span>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 testing its November lows as investor sentiment has turned sour following Friday\u2019s optimism stemming from a combination of encouraging U.S. employment data and the BoE\u2019s Darling stating that he believes the UK economy has turned a corner.\u00a0 We have since witnessed a risk-aversion trend since Friday\u2019s events as … <\/p>\n

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