By Fast Brokers – The Cable has outperformed over the past 24 hours as investors react positively to the details of parliament’s emergency budget. The new tax on financials is not as high as earlier anticipated, giving banks a boost and pushing the Pound higher. Meanwhile, the EUR/USD is hanging tight within its uptrend trading range, a positive for the risk trade as a whole. The performance of the Cable will now depend on the outcome of today’s BoE meeting minutes. Should the central bank give a vote of confidence to the UK economy this could lead to a test of the Cable’s highly psychological 1.50 level. On the other hand, the Cable’s present upswing could be derailed should investors react negatively to the Fed’s monetary policy meeting or if any unwanted developments occur in the EU. The UK will be quiet on the data wire for the remainder of the week, meaning psychological should retain control of the markets along with U.S. economic data, placing additional emphasis on today’s U.S. new home sales figure. If new home sales disappoint like yesterday’s existing home sales number this could cap near-term gains in the Cable.
Technically speaking, 1.50 is still hanging over head along with 6/21 highs and multiple uptrend lines. As for the downside, the Cable has intraday and 6/17 lows serving as technical cushions along with the psychological 1.45 level should it be tested.
Present Price: 1.4878
Resistances: 1.4879, 1.4917, 1.4938, 1.4957, 1.4984, 1.5005
Supports: 1.4839, 1.4801, 1.4767, 1.4746, 1.4715, 1.4680
Psychological: 1.50, 1.45, June highs and lows
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