13 Jan 2015



After testing the five-year lows at 1.1875 as the new resistance, the rate seems to be consolidating. It is possible it will continue trading in a tight range till the Eurozone's CPI figures on friday.

A break below the short term trendline below 1.1786 should take the rate down to test the yearly low at 1.1756.  A break below this level is needed to confirm the resumption of the downtrend with the next support coming in around 1.1650.

Only a daily close above the 1.1875 would invalidate my immediate bearish outlook which would indicate the rate has started a broader retracement  towards 1.2000 figure.


Very disappointing inflation figures from UK have driven the price down this morning. The rate has formed something of a double top at the old support/new resistance.

A break below the neckline would indicate the rate is ready to continue it's downtrend and head down to test the major psychological support at 1.5000.

A break above this week's range at 1.5195 would not help the sterling a lot as the broken post economic crises rising trendline should provide strong resistance at 1.5250-1.5320.


The rate is currently trading inside a potential symmetrical triangle range. As long as we are trading inside this triangle or haven't defined a strong range I am waiting on the sidelines, however the rate may offer some short term trading opportunities.

A break below the 118.00 level should take the rate down to test the support at 117.50 and a potential triangle support around 117.00.

Any upside moves should be capped by two falling trendline resistances around 119.00-119.50 area for now.


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