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Pounds to Dollars Forex Forecast 12 July 2010

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Pounds to Dollars Forex Chart 12 July 2010

Last week’s price action for sterling was characterised by sideways price consolidation confined to a narrow trading range which appears to have resistance at the USD1.5241 price region, a price level that has been challenged on several occasions.  This level now appears to have created a significant obstacle to thWithe recent rally and as a result we may now expect the pounds to dollars pair to re-trace in the medium term as the market now appears to be exhausted, having run into the deep resistance at this zone.  Friday’s price action exemplified the market’s exhaustion with a weak attempt to rally promptly capped and ending below both the 9 and 14 day moving averages as a result.  This morning’s London trading session has seen the market react to the release of the final gdp numbers for the UK (which came out a month late) and at time of writing the pair is trading around the USD1.5046 price handle.  Any close below the 14 day moving average will indicate a deep move, and should we see the 40 day moving average breached at USD1.48 then expect bearish sentiment to replace the recent bullish picture with a probable move to re-test support at the USD1.4227 price level.

Although I now cover all the forex trading news for the pounds to dollars pair on my new forex trading site, this week is important for markets generally as we have the start of yet another quarterly earnings season as well as the release of two key pieces of Chinese fundamental data, namely final gdp and cpi, which will dictate risk appetite for the market moving forward.

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