GBP/USD To Consolidate With Risks Skewed Lower
Asia-Pacific exchange net America 2010-02-04 08:12:33
GBP/USD to consolidate with risks skewed lower. Spotlight on BOE interest rate decision, asset purchase facility at 1200 GMT: expected to hold policy rate at 0.55%, asset purchase limit at GBP225 billion. GBP/USD undermined by broad-based USD strength, weak UK fiscal situation, dismal UK January services PMI (dropped to 5-month low of 54.5 from 56.8 in December, below forecast for 56.1); but downside limited by caution before tomorrow''''s U.S. non-farm payrolls report. GBP/USD daily chart negative-biased as MACD bearish, while stochastics stay suppressed at oversold, suggesting sideways or lower GBP/USD trading near-term. Support at 1.5848 (Monday''''s low), then at 1.5830 (Dec. 30 reaction low); breach would expose downside to 1.5705 (Oct. 13 trough). Resistance at 1.5971 (hourly chart), then at 1.6069 (yesterday''''s high, just below previous base set Jan. 22); breach would temper near-term negative outlook, exposing upside to 1.6179 (Friday''''s high), then 1.6216 (55-day moving average), 1.6243 (200-day moving average), 1.6262 (100-day moving average).