The British pound or Cable rose on Thursday after a stronger-than-expected headline reading of UK retail sales suggested the UK economy is slowly improving. Sterling climbed after British retail sales jumped 2.1 percent on the month in February, more than forecasts for a 0.7 percent rise. The rise was a temporary as by the end of the day the GBP/USD touch lower to 1.4800 as Investors clearly didn’t feel too strongly about Darling’s 2010 budget since the Cable was unable to break through any meaningful technical barriers. But by the end of the week, the cable managed to stabilize a bit and has avoided a retest of Thursday lows. The Cable is continuing to level out in the search for a new base. The currency pair is still trading well below key uptrend lines with numerous downtrend lines hanging overhead indicating momentum remains to the downside for the time being.
The data wire will be relatively quiet on Monday around the globe. The UK will print Net Lending to Individuals, though it is unlikely this release will garner noticeable attention. Hence, it appears psychological forces will be in the driver’s seat for the near-term, so investors should keep an eye on the news headlines for any further developments in the EU regarding fiscal situations.
Technically, on the one hour chart, the pair is inching upward with higher highs and higher lows. Any breakthrough of the downtrend A-B and the 89 EMA are expected to carry the pair toward the resistance at 1.5000-1.5020 level. Support is at 1.4800.
