The pair closed in NY Tuesday at $1.6045 after rate had recovered off session lows of $1.6025. Cable had been under pressure for most of Tuesday’s session, as rate extended its corrective pullback off recent highs of $1.6248, with euro-sterling’s drive up to stg0.8585 providing the main weight. The cross closed in NY at stg0.8566. Cable edged to $1.6053 in opening Asian trade before turning lower, the rate easing off to retest that NY low at $1.6025 where it again ran into willing buyers. Traders in overnight reports have suggested that the area between $1.6030/00 seen as a good area to go long, though keeping stops tight under $1.6000. Euro-sterling bounced between stg0.85615-0.8572 through Asia, opening Europe toward the base of that range. End month approaching and market looks well positioned for any cross demand at the fixings, with cable expected to benefit from equity based end month dollar sales. A light domestic data calendar with most attention seen on end month flows and tonight’s FOMC decision (1800GMT). A break of $1.6000 to open a deeper move toward $1.5980. Resistance seen at $1.6050/55, $1.6100/05 and $1.6120. Euro-sterling offersstg0.8585 ahead of stg0.8600/05. Support stg0.8555/40 (200-dma stg0.85377).
