Tuesday’s session started with the Pound appreciating substantially against the US Dollar, which resulted in the rate reaching the upper channel boundary. However, weak data from the UK set the Pound for a free fall down to the 1.3020 mark, thus erasing all morning gains. The British currency bounced off the weekly PP at 1.3009, but failed not recover, thus remaining stranded between the 55– and 100-hour SMAs until the point of writing. The market may be relatively calm and therefore remain in this range prior to US data release at 1230GMT after which some changes should occur. Gains could be capped at the upper channel boundary, while losses should be limited by the 200-hour SMA circa 1.2940. In case the given data disappoint, the rate might remain below the 100-hour SMA for the whole session.
