Following Tuesday’s doji (spinning top) candle yesterday’s up bar came as no great surprise with the market taking a breather and some profits after the steep down trend of the past 2 weeks.  The high of the session failed to breach the 9 day moving average suggesting that the short squeeze we are seeing may only be a temporary reversal before the downward trend is re-instated once again and indeed such reversals provide excellent opportunities to enter further positions in readiness to take advantage of a further move south.  With all three moving averages pointing lower and with little sign that the trend is likely to reverse in the short term my initial target of .80 remains the same as we build longer term positions to take advantage of this current move.   The $undamental newss morning focused almost solely on the British Pound which took a severe battering in early trading with a raft of bad news including poor retail sales, eye watering levels of public sector borrowing, worse than expected money supply figures and plunging industrial orders which does rather beg the question as to why anyone would want to buy the British Pound?  However, we are in the business of technical analsyis and not sentiment and whilst the euro rose against cable this morning as a result, it has since pulled back bouncing off the 14 day moving average suggesting of downwards pressure once again.

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