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Sterling Digest, May 16, 2012: cracks deepen
Weak sterling still looks good

Sterling cracks from Friday that were glossed over on safe haven flows deepened today thanks to Bank of England Governor Mervyn King. Complete with a GDP downgrade for 2012, King’s inflation report weakened sterling across board. However, currency pairs like the $GBPCAD, $EURGBP and $GBPAUD are holding up quite well in the aftermath. General commodities weakness and euro woes continue to benefit GBP verus these currencies. These same conditions also benefited the USD as the $GBPUSD closes below 1.60 for the first time in 4 weeks.
- Bank of England Inflation Report presser: live blog (FT)
- Euro crisis a threat to slow UK recovery – BoE’s King (Reuters)
- UK’s Cameron: Eurozone Must Act Or Face Break Up (Forex Live)
- GBPUSD Update (50’s Blog)
- GBPUSD Bounces Off The 38.2% Of 2012 Range (Forex Live)
- GBPJPY Update (50’s Blog)
- Bundesbank Confirms German Gold Held By FED, BOE and Banque De France (Zero Hedge)
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May 16, 2012
Sterling Digest, May 11 2012: the cracks appear
Hollande may not be any different for the euro

Sterling ends the week weak across the board. Profit-taking was the theme this Friday trading session as investors banked pips on a strong bull trend in sterling that has been raging for weeks. As we head into the weekend, the question that traders start to ask is: did we witness a correction this week or the beginning of a reversal as the market comes to grips with a very weak UK economy relative to others in the G10 such as Canada, Australia, and the US. Watch the major psychological level at 1.6000 in $GBPUSD, $GBPAUD, and $GBPCAD for answers into the new trading week ahead.
- King Seen Signaling QE an Option as Euro Tensions Flare (Bloomberg)
- Euro Anti-Austerity Votes Pose Dangers for Britain (EconoMonitor)
- David Cameron: the man in the middle in Europe (The Telegraph)
- GBPUSD Update (50’s Blog)
- Lots of questions about GBPCAD (Chart.ly)
- The Nasty Cable Trade (MarketVision TV)
- EUR/GBP: Retest Of .8000 Likely After Brief Bounce (FX360)
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May 11, 2012
Sterling Digest, May 18 2012: Facebook Friday
Mark Zuckerberg rings the Nasdaq bell from California (Zef Nikolla/AP)

$FB is so hot that Nasdaq brought the bell to them. However, $FB Friday didn’t change profit-taking week end flows leaving sterling a mixed bag on the week. $GBPNZD has been a monster breaking out to new highs again this week. $GBPAUD and $GBPCAD, meanwhile, chopped around in wide ranges. And the $GBPJPY and $GBPUSD fell hard. A $GBPUSD close BELOW 1.58 is as big a deal as a close below 125.00 is for $GBPJPY. Those cracks we noted all week in this digest seemed to widen a bit more today.
- GBPJPY Moves Below 100 Day MA (Forex Live)
- Fib RETRACEMENT Taken from the March Advance shows interim support at 1.5750 (Chart.ly)
- Britain says ECB could do more to suppport demand (Reuters)
- Lloyds’s Williams Says BOE Must Preempt Need for QE (Bloomberg)
- BoE and Fed Ignite QE Hopes (Currency Solutions)
- Merkel under pressure at G8 for eurozone economic stimulus package; Cameron seeks to build ties with Hollande (Open Europe)
- Facebook on SecondMarket (SecondMarket)
- Facebook Seeks To Be Infrastructure (Bloomberg)
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May 18, 2012

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