By Fast Brokers – The Cable is creeping higher as most of the risk trade retreats as the Pound enjoys a relative strength stemming from another encouraging CCC release. The CCC printed well below expectations and last month’s release was revised lower, a positive development regarding a turnaround in UK unemployment. On an interesting note, despite another huge drop in the CCC the headline unemployment rate popped two basis points to 8%. Additionally, average earnings came in two basis points below analyst expectations. Hence, today’s employment picture isn’t all rosy. Meanwhile, strength in the Pound is being subdued by weakness in the risk trading. Greek bonds hit 8% and fear is rising that the SEC could go after more financial houses other than Goldman. The uncertainty is outweighing positive earnings from Apple and Morgan Stanley while keeping U.S. equities at bay. Hence, the Cable could have a tough time topping previous April highs today. The UK will keep the data train rolling tomorrow by releasing retail sales and public sector net borrowing. Additionally, the EU will print its closely watched Flash PMI data set followed by PPI, unemployment claims, and existing home sales figures from the U.S. Furthermore, psychological forces are swirling around the globe and have the potential to flare and overtake any fundamental developments. Either way, activity could pick up tomorrow due to the amount of data hitting the street.
Technically speaking, the Cable has managed to avoid a retest of previous April lows thus far and has intraday lows along with its psychological 1.52 and 1.53 levels serving as technical cushions for the time being. As for the topside, the Cable faces multiple downtrend lines along with intraday, 4/12, and 4/15 highs. Additionally, the 1.54 and 1.55 levels could serve as a psychological barriers over the near-term.
Present Price: 1.5399
Resistances: 1.5404, 1.5419, 1.5435, 1.5453, 1.5469, 1.5486
Supports: 1.5386, 1.5371, 1.5354, 1.5341, 1.5325, 1.5310
Psychological: 1.55, 1.54, 1.53, 1.52, April highs and lows
(click chart to enlarge)
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