Pounds vs Dollars - GBP to USD Daily Chart 1st June 2009

Pounds vs Dollars - GBP to USD Daily Chart 1st June 2009

Yesterday’s candle on the pounds to dollars daily chart did indeed close the session with a heavily bearish flavour as evidenced by the deep upper shadow and small lower body, a classic shooting star signal and once that we need to consider carefully as a possible early warning.  The price action in creating the candle was largely triggered as a result of the dire UK GDP figures released during the London trading session which showed an economy in a far worse state than previously thought and certainly not the rosy picture painted by the fantasist Prime Minister, Gordon Brown and his assistant (and also unelected Prime Minister in chief), Lord Mandelson.   The only positive aspect to yesterday’s price action is that the low of the day found some support at the 9 day moving average which could suggest that yesterday was merely a blip and not the start of any longer term trend.  Only time will tell and the key will be whether this signal is confirmed or ignored by any subsequent price action on the daily chart.  Until the market has absorbed the remainder of this week’s fundamental data which in turn will decide the direction for the US Dollar the sideways consolidation in the pounds to dollars is set to continue.

The items of fundamental news on the economic calendar for the US Dollar are in covered in detail on the main Eurodollar site while for the UK this morning saw the release of manufacturing PMI data which came in marginally better than expected at 47 against a forecast of 46.4 whilst the Index of Services came in significantly worse at -1.2% against a forecast of +0.2%.

Much like the Eurodollar I would tend to favour the long side for this pair but this will be confirmed by tomorrow’s events.

You can keep up to date with all the latest fundamental news on the economic calendar, latest currency news and live currency charts by simply following the links.  I have also included details on an excellent ECN broker.