{"id":9228,"date":"2010-05-07T13:04:42","date_gmt":"2010-05-07T17:04:42","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=9228"},"modified":"2010-05-07T13:04:42","modified_gmt":"2010-05-07T17:04:42","slug":"gbpusd-undergoes-intense-selloff-following-elections","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2010\/05\/07\/gbpusd-undergoes-intense-selloff-following-elections\/","title":{"rendered":"GBP\/USD Undergoes Intense Selloff Following Elections"},"content":{"rendered":"

By Fast Brokers <\/strong>– The Cable has undergone a massive selloff today as the Pound underperforms in reaction to the parliamentary election results.\u00a0 As expected, the concept of a hung parliament does not bode well for the Pound as discussion sparks whether a divided government will be able to enact austerity measures necessary to clean up the UK\u2019s fiscal mess.\u00a0 The election results prove untimely considering the risk trade collapse that has taken place over the past couple trading sessions.\u00a0 Investors rushed towards the dollar yesterday as U.S. equities underwent an incredible selloff in reaction to mounting fiscal problems in the EU and a \u2018technical error\u2019 on the stock exchange floor.\u00a0 Contagion in the EU is leading analysts to wonder whether the UK is next and this places more emphasis on the fact that the UK now has a minority government.\u00a0 However, with the election out of the way, investors will now look to the G7 conference call taking place today to see whether the developed nations can issue a comforting, unified message in reaction to yesterday\u2019s market panic.\u00a0 That being said, it will be interesting to see whether the risk trade can manage to pull itself together and stabilize over the remainder of the session.\u00a0 The weekend can give the markets time to cool off and look forward.\u00a0 That being said, China\u2019s key economic data releases on Monday and Tuesday could be a deciding factor regarding whether the risk trade can form a new base or whether the brisk risk route continues.\u00a0 The BoE will also make a monetary policy decision on Monday, meaning the Cable could be in for another active session to kick off the week.\u00a0 Investors will be looking to King & Co. to issue a statement that can reinvigorate confidence in the global economic recovery.\u00a0 After all, outside of the fiscal issues in the EU fundamentals have been altogether sound.<\/p>\n

Technically speaking, the Cable faces mounting layers of downtrend lines along with intraday highs and the psychological 1.47 and 1.48 areas.\u00a0 As for the downside, the Cable has technical supports in the form of April 2009 lows and the psychological 1.45 area.<\/p>\n

Present Price: 1.4693
\nResistances: 1.4707, 1.4730, 1.4748, 1.4762, 1.4775, 1.4795
\nSupports: 1.4654, 1.4641, 1.4616, 1.4594, 1.4574, 1.4559
\nPsychological: 1.45, 1.46, 1.47, 1.47, April 2009 lows<\/p>\n

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

(click chart to enlarge)<\/p>\n

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

Disclaimer:<\/strong> FastBrokers\u2019 market commentary is provided for information purposes only and under no circumstances should be regarded neither 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 has undergone a massive selloff today as the Pound underperforms in reaction to the parliamentary election results.\u00a0 As expected, the concept of a hung parliament does not bode well for the Pound as discussion sparks whether a divided government will be able to enact austerity measures necessary to clean … <\/p>\n

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