On Thursday the pound/dollar was trading above the LB in a range of 70 points. In the first half of the day the rate dropped to 1.5173 and in the second it returned to 1.5240. It’s now at 1.5199. If European trading sees a break of the 1.5191 support (LB and trend), I’ll be expecting a weakening of the pound to the 67th degree at 1.5145 (technical signal without any fundamental news).
There is no important macro-economic data set to come out of the UK today. We could well see a calm correction against the growth from the 1.5026 minimum. The pound so far has corrected too high.
The pound/dollar has met the trend line with its wall (this trend line was broken on 6th November). The sellers now need to quickly strengthen below 1.5173 (yesterday’s minimum). This would allow them to push the buyers back to 1.5130 and from there we would have to take a look at the setup of market participants. If the buyers run from the market, it means that we will head to 1.5026, if not: we should assess what will come about on the 4h timeframe.
There’s no change on the weekly graph. The closest target is still at 1.4900.