Sterling was the star in September against the majors and crosses. The hawkish shift by BoE at their meeting on September 14 sends the GBP 5% higher against EUR last month.
Germany election and Catalan independence referendum are the risk factors to euro in the near term.
Q2 UK’s current account deficit was £23.2 billion
UK Q2 GDP unrevised 0.3% from the second estimate
UK manufacturing PMI registered 55.9 in September, down from August’s four-month high of 56.7
Upcoming data: This week is an important week for sterling, PMI readings due.
Tue, Oct 03
Wed, Oct 04
Thu, Oct 05
MPC Member McCafferty Speaks at The Founders’ Company Annual Lecture, in London
MPC member Haldane speaks at central bank engagement with society at the Economic Research Council, in London
EURGBP retrace 50.0% (April- Aug rally) and settles below 20MA (weekly). Last week’s price action appears a minor support base printed tad above 200MAs (daily).
This week’s trading range remains between 0.8700 and 0.8900. The 61.8% fib reaction finds at 0.8680 a move below this open to 0.8640, 0.8600 and 0.8530. Recent price action printed a ceiling at 0.8900, if propel 0.8950, 0.8980/0.9000 expected. In the extreme case 0.9050 possible.
A weekly close below 0.8680 could retrace further to 0.8300 in the medium term.
Monthly trading range: 0.9050-0.8530
It is important to always keep in mind the risks involved in trading with leveraged instruments.
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