Data

Overview

The governor of the Bank of England, Mark Carney, has shocked the markets yesterday revealing that interest rates could actually rise and sooner than we expect. Before yesterday the data reported by the markets foreshadowed that the rates would not be hiked from their historical value that is fixed on 0.5% until at least early next year. However, we report one of the key phrases uttered by Carney last night:

“It could happen sooner than markets currently expect”.

The pound has jumped shortly after arriving to assert € 1.25 (the highest level since last fall), and climbing from $ 1.68 to $ 1.69.

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The exchange rate reached its peak touching 173.36 and broke the resistance that was stable from 9th May and equal to 172.53 confirming the resumption of the rebound from 169.53. The new resistance level is set at 173.6 and this value is not exceeded by January 2014; a break of this might even lead to the achievement of the maximum reached by the GBP/JPY since April 20, 2008 and amounted to 174.76, which we can call key resistance level. The support level is fixed and equal to 170.95. We can assume that the rupture of the key resistance level can ensure the continuation of the bullish trend that continues from April 2012.

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In the picture above the trend from 116.83 is continuing to rise and the MACD indicator provides positive signals that suggest a separate highest level of GBP / JGY.

MACD