The pair closed in NY Monday at $1.6800 after rate had been pulled lower by euro-dollar’s stronger corrective pullback, the rate pushing down to $1.6784 before drifting higher into the close. Euro-sterling diverted some of the euro sell pressure, the rate pressed down to stg0.8089 (61.8% stg0.8064-0.8130) with rate closing the day around stg0.8090. Asian trade was again described as subdued with cable confined to a range of $1.6798-1.6815, the cross holding stg0.80835-0.80915. UK industrial/manufacturing production data provides the domestic highlight today, with median expectations for improved data (IP 0.4% m/m; Mfg 0.4% m/m), the market to take direction from the outcome. Recent positive releases in the UK has kept the rate hike debate open, while the EZ has just moved rates lower with the possibility of further liquidity provisions going forward. This in turn has market open to holding long term short euro-sterling positions, though one UK clearer has suggested we could see better short entry levels. Cable demand remains into $1.6780, with stops noted on break of $1.6770. Resistance now seen at $1.6830/45. Euro-sterling bids stg0.8080 (76.4% stg0.8064-0.8130), resistance stg0.8100/05
