Opened early Europe at $1.6172 stg0.8154, GBP closed in NY at $1.6179, the rate having retained an underlying buoyant tone through Thursday’s session, holding just off extended highs at $1.6208, with pullbacks in this session contained by $1.6167. Rate was knocked down to $1.6166 into early Asian dealing as it tracked EUR/USD negative reaction to S&P’s late NY session downgrading of Spain (2 notches to BBB+). Rate recovered to $1.6191 before stalling, the rate then drifting lower through the balance of the overnight session with early Europe adding further weight as it broke under its overnight low to extend base to $1.6153. Rate recovered off lows as EUR/GBP was pressed through stg0.81435 (recent low) to stg0.81345, pushing up to retest the resistance area between $1.6190/00. Strong headwind supply pressed rate back to $1.6180 as EUR/GBP began lifting away from its base. The cross rally extended to stg0.8166 and sparked talk of European sovereign end month demand. Cable rallied back on order exhaustion, tripping $1.6220 stops, extending move to $1.6236.
EasyForexNews Research Team