Finotec News Archive - April 21 2008
Early strength for GBP sees U.S. dollar suffers another blow.
Sterling surged broadly on Friday, hitting a 7-week high versus the yen and bounced off a record low versus the euro on speculation that a plan to ease mortgage market conditions would limit the scope of UK rate cuts.
Anthony Boyajian 
21 April 2008
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| Long signal | Short signal | |
|---|---|---|
| Buy a break of resistance level at 2.0045 | Sell a break of support level at 1.9925 | |
| GBP/USD | Buy a break of resistance level at 2.0090 | Sell a break of support level at 1.9880 |
| Buy a bounce at 1.9925 | Sell a failure of breaking the resistance 2.0045 |
Fundamental
Sterling surged broadly on Friday, hitting a 7-week high versus the yen and bounced off a record low versus the euro on speculation that a plan to ease mortgage market conditions would limit the scope of UK rate cuts.
Hawkish comments from Bank of England economist Charles Bean late on Thursday that British inflation is likely to rise above 3 percent this year also boosted sentiment towards sterling.
A UK Treasury source said on Thursday that British authorities could announce details of a plan to ease tight conditions in the mortgage market as early as next week. Speculation has been growing that the BoE could allow banks to temporarily swap mortgage-backed securities for government bonds to help ease the lending squeeze.
Technical
The Sterling may continue the uptrend against the US dollar; according to technical charts the market is in a bullish direction with confirmation of many indicators like RSI, which is in an uptrend, MACD breaks the signal line upwards, Bollinger gives us a bullish signal by closing the candle above the middle band.
GBP/USD (Daily Chart)
The primary tendency is clear downtrend.
GBP/USD (4 Hour Chart)
The medium term breaks the trend line upwards.
GBP/USD (Hourly Chart)
The Minor trend shows us a clear uptrend.
Resistance
2.0045
2.0090
Support
1.9925
1.9880
Finotec Analysis Team
21 April 2008
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