Pound Dollar Chart 4 Dec 2009

Pound Dollar Chart 4 Dec 2009

Like many other currency pairs, the pounds to usd pair too moved lower on Friday prompted by the release of the NFP data which helped the US dollar recover some of the lost ground of the past few months, ending the trading session (and the week) with a wide spread down candle with a deep wick to the upper body, suggesting that we are likely to see this bearish sentiment continue in early trading this week.  However for the pounds to usd  pair, unlike the euro dollar, the move was far from convincing, and has certainly provided little in the way of any additional signals or change in sentiment for this pair, with further sideways price action the order of the day once again this week.  If, and until, we see a major recovery in the US dollar, then this period of price congestion is set to continue in the longer term, and until we see a break above or below the price thresholds now well established in the current channel, then I’m afraid there is little else to say for the time being!

Whilst there is no fundamental news for the UK this evening has a speech from Fed Chairman Ben Bernanke entitled “Federal Reserve Frequently Asked Questions” which may inject some volatility into the market.  Later in the evening sees the release of the Consumer Credit data which measures the total outstanding consumer credit (payments which require monthly instalments) and the forecast figure is -9.6b, down from -14.8b and it will be interesting to see if consumers are continuing to try and pay back their unsecured debt obligations.  Although this release is classified as a second tier announcement it is interesting as it highly correlated with consumer spending and confidence and a good indicator of market sentiment.

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Support & Resistance for Pounds to USD :

s1:  1.6369    R1:  1.6617

S2:  1.6272   R2:  1.6768

S3:  1.6121   R3:  1.6865