GBP USD Recovers into Close; Needs to Hold Gann Angle to Sustain Rally
Technical, Fundamental Factors Hold GBP USD Rangebound
The GBP USD continued to trade inside of the September 30 outside range day at 1.5922 to 1.5668. This pattern has temporarily frozen the trade as traders await the latest monetary policy statement from the Bank of England on October 7. A pair of Gann angles is also forming a triangle between 1.5895 and 1.5676. This formation is also helping to confine trading activity.
The lack of major economic reports seems to be limiting movement to the upside in U.S. equity futures this morning. Absent today is the driving force which helped boost prices higher on Friday. We could be looking at a slow start to the week since the final reading of U.S. GDP on Thursday is likely to garner most of the attention.
The Dollar rose against the Euro late in the trading session after the release of the Fed’s Beige Book. The business survey showed subdued U.S. economic growth which led speculators to believe the Fed won’t be raising interest rates soon despite what investors had earlier interpreted from Chairman Bernanke’s comments.
Stocks Fail to Hold Gains; Traders Still Worried about Risk
U.S. stock markets failed to hold onto earlier gains and finished lower for the session. At the midsession, equities were trading higher as speculation that a new U.K. government had been formed helped draw buyers into the market while triggering liquidation by weaker shorts. The news out of the U.K.
U.S. equity futures weakened after an early session surge but managed to eke out a small gain. Overnight strength was fueled by greater demand for higher yielding assets while the early morning rally was triggered following the release of a report showing a rise in consumer confidence. Thin trading conditions and the lack of buyers were the driving forces behind this afternoon’s weakness.
The December E-mini Dow and December E-mini S&P 500 posted strong gains on Friday but closed unchanged for the week following the release of bullish retail sales and consumer confidence reports. Both reports indicate the economy is on the road to recovery and could give the Fed enough evidence to issue a more hawkish statement at its next meeting on December 16th.
Equities Manage to Hold on to Weekly Gains despite Stronger Dollar
U.S. Stock Indices Hold on to Gains in Tight Range Bound Trading
U.S. equity markets held on to their gains following a stronger opening fueled by increased demand for higher yielding assets. U.S. investors held the markets inside of the range established earlier in the day as once again investors did not feel the need to chase the markets higher. The strong rise in hard assets also boosted the price of industrial metal stocks.