GBP/USD 1.6585 – 2 December 2009

GBP/USD Open 1.6620 High 1.6648 Low 1.6396 Close 1.6610
After Pound/Dollar failed to retain its earlier gains yesterday, it started dropping from Tuesday’s top at 1.6648, closing the day at 1.6610. Downward pressure came from a report showing that consumer confidence in the UK unexpectedly weakened and the common expectations are that the British economy will continue to weaken in the short term, despite the huge amounts of incentives by the financial system. On the 3 hour chart we can see that after testing the 1.6859 resistance level, the Cable started descending and has formed short term downward channel. More selling pressure could hit the Sterling, if last week’s bottom at 1.6285 is breached. If Sterling fails to hold above 1.6264, bearish strength might get stronger acceleration. Immediate resistance is 1.6648, the break up of which may lead to upward impulse with possible test of 1.6725. The CCI indicator has crossed up the 100 line on the 1 hour chart, suggesting bullish pressure.
Technical resistance levels: 1.6648 1.6725 1.6860
Technical support levels: 1.6395 1.6285.6175

Trading range: 1.6575 – 1.6645
Trend: Upward
Buy at 1.6585 SL 1.6555 TP 1.6635


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