Closed in NY at $1.5833 after getting pressed to extended lows of $1.5806 in a NY holiday thinned market Monday. The recovery extended to $1.5841 in early Asia, dropping back to $1.5829 before picking up fresh demand interest, with the BOJ monetary policy announcement prompting a sharp sell off in yen and allowed cable to push up to $1.5862 before settling between $1.5850/60 ahead of the European open. Euro-sterling extended recent gains to stg0.8424 in Asia (NY stg0.8420) as cable recovery lagged euro-dollar momentum, with rate settling between stg0.8405/20 into Europe. Yen activity continues to dictate direction into early Europe as official comments get released across the wires. UK borrowing data due for release at 0930GMT, with CBI trends at 1100GMT providing domestic interest. However, PM Cameron speech on the UK’s relationship with the EU due Wednesday morning and Q4 GDP Friday (with its threat to show the UK could be entering a triple dip recession) remain the main focus for the week. Cable demand seen placed into $1.5800, a break to open a deeper move toward $1.5780/70 ahead of $1.5750. Resistance $1.5870/75 ($1.5872 76.4% $1.5893-06), $1.5890/00. Key 200-dma comes in at $1.5909.
EasyForexNews Research Team