Pounds to Dollars 25 Aug 2009

Pounds to Dollars 25 Aug 2009

Forex Technical Analysis

Listless and lifeless would best describe the pounds to dollars pair at the moment, as thin trading volumes and a lack of meaningful fundamental news combine to create a market lacking in direction or momentum.  Friday’s candle summed up the mood with a long legged doji, indicating forex market indecision, and yesterday prices eventually drifting lower as a modicum of dollar strength entered the market.  Yesterday’s candle ended the trading session as a down bar closing just below all three moving averages, stopping at the 1.64 support region.   Whether prices can hold at this point and perhaps crawl higher will depend,  in part, on whether Sterling has finally shaken off last week’s turbulence following the release of the MPC minutes.   In addition if significant dollar weakness does return to the market then Sterling may find the impetus it needs to move higher.  My trading suggestion for today is to stand aside until we can be sure that the USD1.64 price handle will hold.

Fundamental Forex Analysis

Tuesday’s fundamental news on the economic calendar for Cable is all about the UK housing market, with two pieces of news which may provide a better view of the broader UK economy, with the release of the Nationwide HPI data first, followed shortly after by the Mortgage Approvals from the BBA. The HPI data is expected to show a modest decline from last time, whilst the BBA numbers are likely to indicate a small rise. However, neither of these numbers is likely to produce the catalyst required to inject some direction into Cable tomorrow. For the US dollar the main item of news is the CB Consumer Confidence Index which I have covered along with the other main items on the euro vs dollar site.

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.