dollars to pounds

Pounds to Dollars Chart 17 Aug 2010

Another day of sideways consolidation as the pounds to dollars pair continued to trade in a relatively narrow range and ended the forex trading session as a narrow spread up candle but with shadows to the top and bottom.  Downside support was provided by the 200 day moving average whilst above the 9 and 14 day moving averages prevented any recovery higher and as a result the current price action is sandwiched between these key technical indicators.  With the 9 day now crossing below the 14 day moving average this has now given us a bear cross signal and as such for this to be confirmed we need to see a break and hold below the 200 day moving average followed by the 40 day moving average.  Should this occur in due course then expect to see a longer term trend develop as we re-test support in the USD1.54 region with a break below the 40 day moving average at this level further confirming the market’s negative sentiment towards the pounds to dollars.  Once this price point is breached then expect to see cable pushed lower to re-test the support level at USD1.5219 in due course.

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