Friday, 18 Sep 2009

Pound Continues its Decline vs. the Dollar

The Pound continued its decline against the Dollar for the second day today on concerns over the speed of the economic recovery in the region, dampening demand for the currency. The pound declined to $1.6310 in today's early trading, from $1.6453 in New York yesterday, after earlier falling to $1.6299, the lowest level since Sept. 4. The currency, however, did rebound as the European trading day progressed; the GBP recovered slightly and is currently trading around $1.6360. The U.K. currency dropped to 149.15 Yen from 149.86 Yen.

The fall in Asian equity markets boosted the Yen versus the Dollar and other major currency pairs as investors returned to the safety of the Japanese currency.
Despite better than expected data from the Euro-Zone early morning, the EUR dropped against the USD, reaching a low of $1.4650. The pair did rebound throughout the day and is currently back to trading above $1.4700.

EUR/GBP heading for Correction

The EUR/GBP cross has experienced a bullish trend for the past few days. However, it seems that this trend may be coming to an end. There is a fresh bearish cross forming on the 1 day chart's Slow Stochastic indicating a bearish correction might take place in the near future. The cross also breached the upper border of the Bollinger Bands, signaling that the next movement may be in a downward direction. A bearish cross is also apparent on the MACD chart. Furthermore, it appears that the pair is currently being overbought, with a correction expected to take place in the near future.