Home » Pounds To Dollars Daily Chart » Forecast Pound to Dollar 16 March 2010

Forecast Pound to Dollar 16 March 2010

Pound vs Dollar Chart 16 March 2010

Friday’s rally by cable which broke above both the 9 and 14 day moving averages was promptly snuffed out yesterday with a wide spread down bar which reversed all of Friday’s gains, closing below all four moving averages once again. The selling pressure on the British Pound is increasing to build and with the weight of futures volumes now exceeding those recorded at the time of the ERM crisis, the outlook does look very bleak.  Technically the picture remains firmly bearish and with yesterday’s wide spread down candle further confirming the outlook a break below the current short term platform at USD1.50 will signal a much deeper move, initially to test support at USD1.48 and then to move towards our medium target of USD1.45 in due course.

There are several items of fundamental news for the British Pound this week, not least the unemployment claims tomorrow coupled with the minutes of the recent MPC meeting, with Thursday seeing the public sector net borrowing figures which are expected to balloon from last month’s 4.3bn to a staggering 14.6bn.  This should be read in conjunction with our analysis of open interest volumes on the cot report which two weeks ago were already building dramatically as prices fell away which suggests the weight of trading is to the short side.

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