Pounds To Dollars - Daily Candle Chart January 30th 2009
Talk about inching higher! The pounds to dollars currency pair is crawling it’s way up at the moment, in ever smaller steps, and yesterday was no exception with another up day, but only just, finishing with a long legged doji, which as I’m sure you know by now, is hardly an endorsement to the move! The doji signifies indecision in the market which just about sums up the current situation for the GBP/USD pair with the UK pound holding up better than many other currencies, as analysts and the market re-consider whether the pound is indeed the basket case everyone thought. The comments by the ECB regarding the long term outlook for the UK economy will not have helped, and despite Gordon Brown’s attempt to save the world none of the great and the ( less good ) in Davos, have a clue what to do! Yesterday’s candle crossed the 14 day moving average, but with significant resistance ahead at 1.4500, the move will need to breakthrough this region to advance further. My suggestions for today would be to attempt small long positions with stops below 1.4125, but the move looks suspiciously as though it could be rolling over as it approaches the resistance level, so be careful.
On the fundamental front the main news today is in the US with the release of the advance GDP figures, due to be released at 1.30 pm UK time. These will move the currency pair, so trade with care and my suggestion would be to take any profits off the table before the news, and to re-enter later. Have a great weekend and as always good luck with your trading.
The short term outlook is bullish, the medium and long term are sideways
