dollars to pounds

Pounds to Dollars Chart 12 Aug 2010

In tandem with the euro vs dollar the pounds to dollars pair too reversed abruptly following the FOMC meeting and ended yesterday’s forex trading session as a wide spread down bar which closed below our shorter term moving averages.  Today’s price action has seen the pair fall further and edging closer towards the 200 day moving average which now needs to hold if the pounds to dollars pair are to have a chance to regaining some kind of upwards momentum.  From a fundamental perspective a reversal higher appears unlikely with traders and investors moving out of riskier assets and into safe havens such as bonds and gold and these may be given a further boost tomorrow with some important news releases for the US in the afternoon making the weekly close for the pounds to dollars crucial.  Indeed a glance at the weekly chart shows the formation of a bearish engulfing candle heading rapidly towards the 40 week moving average.

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