Sterling Digest, April 5 2012: the herd shows itself

coins in water
Sterling down the drain...for the moment

Last week, the economic data built the case for a possible double-dip recession. This week, the PMI trifecta (industrial, construction, & services) came out quite strong. However, the bulls never rallied $GBPUSD back above 1.60. Then today we get dismal manufacturing and industrial production numbers and $GBPUSD takes a real hit in sentiment as price breaks to new lows for the week. $GBPCAD, $GBPAUD, and $GBPNZD are all lower on the week as well. Anytime the market shows its true bias, both technically and in reaction to fundamentals, you have to go with the herd. And sterling bears are keen on taking it lower short-term.

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