OctaFX | OctaFX Forex Broker
Open trading account
Back

Forex: GBP/USD bounces calmly from early tumble

The British Pound tumbled strongly at first, reaching 1.5074 low, but has bounced back above the 1.5100 mark, currently at 1.5145.

UK BBA Mortgage Approvals eased from 33.6K to 32.3K in January, instead of rising to 34.2K as expected. The economic calendar is very light today, except for the Italian election, with first polls expected to appear around 15:00 GMT.

“We suspect we will see the market consolidate some of these losses ahead of further weakness”, wrote Commerzbank analyst Karen Jones, pointing to 1.5000 and then 1.4853 beyond the rebound.

Fundamental Morning Wrap: Sterling hammered with further downside ahead

A morning review across institutional research understandably notes that GBP is in sharp focus following the Friday downgrade. However, the general consensus is that the move has already largely been priced in a long time ago and and any sharp reactions are merely knee jerks. They see further downside ahead, with 1.40 being touted as an area representing more fair value for the pair. Looking to Japan, news that Kuroda may be appointed Governor of the BoJ has generated headlines, but not price volatility. In Europe, markets are watching for results from the Italian election.
Read more Previous

Forex Flash: Italy election expectations – TD Securities

The Italian election voting process will end at 14:00 GMT, giving way to first polls around 15:00 GMT. TD Securities analysts expect the Chamber of Deputies to go to Bersani’s coalition, so for the Senate race, they’ll be looking for two main things when the headlines start coming out: “First will be the number of seats projected for PD + Monti; anything greater than 158 is a majority, and the higher the better”, wrote analyst Alvin Pontoh, adding that “the Senate races in Lombardy and Sicily will be especially important, as that will likely be where the outcome of the upper house will be determined”. Also important to take in account is support for Five Star Movement, “since the higher their support the harder it will be to form a working coalition”.
Read more Next
Start livechat