pounds to dollars

Pounds to Dollars Chart 3 Aug 2010

The pounds to dollars pair pushed strongly higher yesterday surging through the USD1.58 level and ending with a wide spread up candle having briefly touched USD1.5907 during the forex trading session.  This bullish momentum has continued through this morning’s London trading session as the pair now approach the psychological USD1.60 level with a further move higher now likely, particularly given that the 9 day moving average has crossed above the 200 day moving average giving us a further bullish forex signal as a result.  The 14 day moving looks likely to follow suit shortly and with the continued decline in the US dollar, as evidenced on the usd index chart, the gbp usd pair continue to be a major beneficiary of sustained dollar weakness at present.

The extent of this current move higher will now be dictated by the potential resistance now immediately ahead which extends up to and beyond USD1.6746 where the previous rally of 2009 eventually ran out of steam.  On the monthly chart the pair have cleared both the 9 and 14 month moving averages but the 200 month average now sits ominously above in the USD1.6550 area which could signal the extent of the current rally as a result.

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