The pair closed in NY at $1.5322 after rate had spiked to a high of $1.5376 following the release of weaker than forecast US ISM data (putting back thoughts of Fed tapering as well as catching the market long dollars) with rate easing off to $1.5314 ahead of the close. Sterling had been given an earlier boost by the release of stronger than forecast manufacturing PMI. Early Asian trade consolidated Monday’s recovery between $1.5314/24 before it pushed up to session highs of $1.5343 as rate tracked euro-dollar (which in turn was influenced by euro-yen demand). Reversal in euro-yen saw cable drift off to $1.5312 into the Asian afternoon before it settled between $1.5315/25 ahead of Europe. Euro-sterling, which had seen extended corrective pullback lows of stg0.8502 Monday consolidated this move between stg0.85225/0.85345 through Asia. UK construction PMI due at 0830GMT to provide domestic data interest, though most await Wednesday’s services PMI to provide a stronger directional indicator. Cable support seen between $1.305/1.5290, a break to open a deeper move toward $1.5270 (76.4% $1.5237-1.5376). Resistance seen at $1.5340/50 ahead of $1.$1.5370/80 ($1.5376 Monday high, $1.5379 61.8% $1.5607-1.5008).
