As outlined in yesterday’s market commentary the wide spread up bar duly provided a strong bullish signal fully engulfing the candle of Wednesday and closing marginally below the 9 day moving average, and as expected we have seen prices move higher in early trading this morning for the $uro to poundr.   In addition this move now has added significance as it has broken above the 9 and 14 day moving averages but, more importantly, through the strong resistance in place at the 0.89 region first created back in February 2009.  Should we see a move above 0.9025 and a break above the 40 day moving average then we could see a reversal of some note with prices perhaps returning to trade within the range between 0.88 and 0.95 for a further period.  My trading suggestion for this pair is to look for small long trades using tight stops and taking any profits as soon as possible.

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