There is no stopping sterling at the moment

GBP/USD

Range:1.6386 – 1.6446

Support:1.6300

Resistance: 1.6550

There is no stopping sterling at the moment as we approach a May high of 1.6518. It seems even with negative economic news and the reluctance of the MPC to pull the trigger on hiking rates, the pound finds its strength for being the least ugly in the ugly currency contest. Yesterday afternoon, sterling took a shot in the leg as EUR/GBP broke through support levels as European debt woes hit the wires. Next was the demise of the USD taking queens currency higher again. Not much to take from UK data so it will all rely on the EUR and USD to drive this market. Med-term, the question is, will cable really break out of 1.6000-1.6500?

EUR/USD

Range: 1.4125-1.4289

Support: 1.4050

Resistance 1.4350

The rollercoaster continues, as they say its looks as bid at the top as it does offered at the bottom! Yesterday afternoon looked like we were going to be testing the 1.4000 support again as comments from Luxembourg’s Junker, who leads the European finance ministers, said the IMF may not release its portion of aid for Greece next month, sent the Euro spiralling. Just as we seemed set to re test 1.4000, the market focused on US yields breaking lower and the possibility that more stimulus could be needed to bolster the faltering US economy in the form of QE3. The market will be looking at the US inflation data along with the Michigan consumer sentiment and pending home sales this afternoon.

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.