GBP/USD Moves Up Against The US Dollar At A Slower Pace Than Other Currencies

The Pound followed the pack of currencies appreciating against the Dollar in an accelerated fashion after the Federal Reserve opted to use quantitative easing to stabilize the U.S. economy.  Although the Cable has made a large movement to the upside over the last 24 hours, its rise has not been as extreme as the EUR/USD since Britain is participating in quantitative easing of its own.

Furthermore, we can’t forget the Britain released a staggering CCC number earlier this week.  Hence, the Cable faces many more obstacles to the upside than the EUR/USD including February highs and the highly psychological 1.50 level.  Regardless, the GBP/USD continues to sprint to the upside since the $300 Billion used in quantitative easing will weaken the Dollar considerably.  Such a large monetary shock should have after-effects for at least a week, which bodes well for the Cable in the near-term.  We placed a new uptrend line on our chart and the GBP/USD is sitting just below it right now.

Fundamentally, we find resistances of 1.4424, 1.4505, 1.4554, and 1.4617.  The 1.45 area will serve as a psychological barrier for the time being.  To the downside, we see supports of 1.4370, 1.4310, 1.4255 and 1.4196.   The GBP/USD is currently exchanging at 1.4435.

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