Like the rest of the currency markets, the Pound is seeing some broad based technical short covering action. For the near term, more hard fought short covering gains are expected with support moving up to 1.6324in the December contract. Limiting the upside in the Pound is reports of a rise in the UK Budget deficit for themonth of August. To transition from a short covering bounce in the Pound, to a resumption of an up-trend patternprobably requires a series of positive UK economic readings and ultimately a rekindling of UK rate hike hopes.
