Forum - GBP (Topic)

Ashraf Laidi

London, UK

Posts: 0

13 years ago

Mar 23, 2011 1:39

Portugal vs BoE? Euro vs BoE?

Either way you look at it, these fundamental dynamics are increasingly expressed in the recent decline of EURGBP. Tuesdays release of unexpectedly high UK CPI kept GBP bulls happy and Wednesdays BoE minutes should once again likely show the same number of hawkish dissenters, paving the way for an April rate hike. ON THE EURO SIDE of the coin, the vote on Portugals austerity package is also due on Wednesday. The main opposition party (centre right) will not back the measures, which could lead to the resignation of prime minister Jos Scrates. This could be a problem for the EU leaders meeting on Thursday to finalize the terms of the EFSF and the ESM.

Could the euro ignore the downfall of the Portuguese govt and remain boosted by interest rate hopes? And if playing EURUSD shorts is unwise, then my bearish EURGBP call remains intact (after failing the all important 0.8770 and the 100-week MA) and now is at 100 pips lower). The Feb 18 trendline is under assault and will need a daily close below 0.8635-40 to pave the way for 0.8590s.

Ashraf

DaveO

N.Cornwall, UK

Posts: 5733

13 years ago

Mar 22, 2011 19:45

Even clothes and shoe prices increased this time. And supermarkets have far too much power in Uk to control pricing. Dairy farmers are shutting shop in droves which is ridiculous. Think of the cost of transporting milk from abroard when we have the most furtile lands in the world. That alone tells me we are heading for a massive correction on insanity.

DaveO

UK

Posted Anonymously

13 years ago

Mar 22, 2011 18:45

Mervyn King is dead against rate rise which can only make matters worse for the Uk economy as 95% of our inflation is external and beyond our control. However I feel the pressure for BOE MPC to do what is "expected" will now become the controlling force. Only by all relevant parties increasing rates to speed the next round of recessions can commodity prices be dampened. Crazy situation imo.

chloethebull

halifax, Canada

Posts: 1183

13 years ago

Mar 22, 2011 18:35

was it merv king that said inflation # would peak b4 they fell back to normal levels and he didn;t think rate hike was priority??also the latest hot figures out might be hotter due to high oil prices but if oil fall so will most inflation figures..so i think boe will chose to wait &monitor costs b4 acting on rate hike..ok gl:)

Ashraf Laidi

London, UK

Posts: 0

13 years ago

Mar 22, 2011 15:25

correction. UK CPI at 4.4% not 4.2%.

Ashraf

Ashraf Laidi

London, UK

Posts: 0

13 years ago

Mar 22, 2011 15:05

Kam, 08770 still holding

28-month highs in UK CPI at 4.2% reinforces expectations of a 0.25% rate hike by the BoE next month, lifting cable to $1.64 to break past the 2007 trendline resistance.

Wednesdays minutes of this months BoE meeting could further fuel the currency towards 1.6450s if they continue to show the 3 hawkish dissenters voting in favour of a rate hike in base rates (Sentence, Weale and Dale). EURGBP shied away from its 0.8770 trendline resistance (see HotCharthttp://bit.ly/ gikAn3 ), making the barrier valid. Dallas Fed president Fisher reiterated his stance against prolonging QE2 beyond June, but the next FOMC meeting wont be until April 27. In order for USD to obtain a boost from such hawkishness into the April meeting, more FOMC members (such as Plosser) have to come forward and give markets a reason to expect actual dissenting votes, rather than voicing opinions regarding beyond June. USDCAD tests 0.78 after disappointing retail sales (-0.3% from -0.2%). Any deterioration in stocks could further support the pair towards 0.9850. More analysis on equity indices to follow next .

Ashraf

Kam

london, UK

Posts: 31

13 years ago

Mar 16, 2011 22:26

Ashraf,
Based on your last post on eurgbp and IMT a close above 0.87 may lead to .8880. Does that mean that bearish move will be invalidated which per your hot chart is 0.8800 trendline resistance?

Kam

DaveO

N.Cornwall, UK

Posts: 5733

13 years ago

Mar 14, 2011 12:12

eurgbp, I have 2 important symmetry levels, first at 8696 almost kissed and then at 8744 to 8760 ext which area coincides with the upper longer term trend resistance line, basis daily t/f.

Ashraf Laidi

London, UK

Posts: 0

13 years ago

Mar 14, 2011 2:19

GBPUSD 4 hr trendline extending from Mar 7 remains intact despite the Friday rebound, setting the stage for a return towards 16010

Ashraf

abundance

Singapore, Singapore

Posts: 27

13 years ago

Mar 11, 2011 0:53

GBPUSD failed to break weekly trendline resistance connecting 04 Nov 07 & 13 Jul 08 highs. Lets see if theres weekly bearish engulfing by end of this week.