The pair closed in NY Wednesday at $1.6310 after rate had been pressed to lows of $1.6252, challenging its 100-dma (today at $1.6255) as euro-sterling was forced through resistance at stg0.8327-33 (high stg0.8334) to take out weak stops before sterling buyers re emerged. Cable recovered to $1.6332 before drifting off into the close. Euro-sterling closed NY at stg0.8296. Focus today on the BOE MPC rate decision at 1200GMT, followed by the ECB at 1245GMT, then press conference at 1330GMT. Most expect the BOE to remain unchanged, focus on next week’s Inflation Report and comments on Forward guidance, whilst the ECB may cut rates (Bloomberg say 4 out of 47 analysts look for a 15bp cut) though most expect ECB Draghi to be dovish. With this in mind traders prefer to fade euro-sterling rallies, Wednesday’s rally allowing for better short entry levels. Unchanged ECB may cause a knee jerk reaction higher in the cross but the press conference is key. In Asia cable recovered to $1.6330as risk was boosted by positive Australian retail sales and trade data but stepped its way down to $1.6303 through the balance of the session, extending to $1.6295 in opening Europe. Rate holds heavy, albeit in a tight range
