Pounds To Dollars - Daily GBP/USD Chart 3rd June 2009

Pounds To Dollars - Daily GBP/USD Chart 3rd June 2009

With all three moving averages pointing higher, and with very little in the way of resistance ahead, there is no reason to suppose that the bullish momentum of the pounds to dollars pair will not continue for some time, and from a technical perspective there is nothing to suggest that we will see any major reversal in the short term. Yesterday’s candle closed the day with an up bar, and with a deep lower wick, suggesting that the bulls took control of the trading session once again, reversing an attempt to move lower early in the day. With our initial target of 1.66 having now been breached we should see a sustained move higher once again in due course, and a move on towards our next target at 1.70, but after such a strong rally, we will undoubtedly see some minor pullbacks on the way up, as the market rests before pushing higher once again.

With very little in the way of fundamental news on the economic calendar in the UK this morning ( other than the Services PMI data which came in better than expected at 51.7 vs a forecast of 49.4), the main focus for today was in the US, on the ADP unemployment figures – a relatively new piece of data, but one which generally provides an excellent guide to the likely NFP figures on Friday. These came out worse than expected sending equity markets lower and the US dollar higher as a result, so a possible signal for the end of the week. The main item of fundamental news for the UK pound tomorrow is ofcourse the interest rate decision from the Bank of England, due for release at midday, with most analysts expecting rates to be kept on hold at 0.5% – any change would be a shock to the market which has already factored this decision into the current price, so this should not cause any major volatility in the dollars to pounds currency pair when released.

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