London Calling
Some early buying of the GBP was not continuing in London this morning and a plogical straddle of 25 pips or so should have gotten you about 15-20 pips/profit. It had been worth watching because the potential for a huge motion was there (considering that the potency of the NFP revisions), but didn't happen.
A more powerful $ trend might be brewing. I tend to think that NY will basically follow London's lead about the GBP, but I don't really see a massive amount of motion either absent any surprise fundamentals. If you see it otherwise you are seeing something I can't, so it will be a quiet day of observing for me. Don't neglect seeing the bond markets, particularly the 3 month and 10 yr notes to see how the thinking is there. Maybe this is of some help: ?We are at a range where it doesn't make sense to make huge bets,? explained Webman of OppenheimerFunds. ?We are kind of neutral.?
Total article:
http://bloomberg.com/apps/news?pid=2...71YArefer=home
We had some basically flat production info from the UK. This weeks BoE rate incr was traded and traders may be paring their bets to get a B0E rate incr. As the information evolves you only need to watch it. Here's some data which should be very interesting:
http://bloomberg.com/apps/news?pid=2...43TiD8refer=ukU.K. manufacturing production suddenly stagnated in September as a U.S. slowdown and a strengthening pound eroded overseas revenue of goods like electrical components.
Most traders consider support and resistance levels, but you will need a better understanding of the fundamentals to gain insight as to why those amounts may be there. The fundamental law of supply and demand stays; A free market will always price goods and services according to what the requirement will bear. If need had continued to pick up as the pound climbed, it's likely those resistance amounts would have been broken, but that didn't occur. Demand slowed and also the price of the pound was not permitted to appreciate further.