Friday’s candle on the daily chart for the $uros to poundsr once again found some support from the 9 day moving average and whilst there was insufficient momentum on the day to break out of the current consolidation, this provided further evidence that we may be witnessing a short term reversal from the recent bearish trend.  As outlined in last week’s market commentary only a break and hold above the 88 price region can validate this particular analysis and if coupled with a hold above the 40 day moving average combined with the crossing of the 9 above the 14 we can then assume that the reversal is complete and may gather momentum in due course.   With a general sell off of the Euro against the US Dollar (on the back of positive US Dollar rhetoric from ECB President Trichet) it is not surprising to see a consequent Euro against Sterling as a result which has provided a degree of impetus to today’s upwards move.

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