The UK Budget on Wednesday will be a tough one for Chancellor of Exchequer AllistaIr Darling. Balancing stimulus with debt will be a difficult act. Add to it the party loyalty implications as the UK moves toward  a tough election battle.  Last week BOE Sentance warned of a possible double dip   What to do?  As a result, the pair may continue to remain contained near the bottom of the range. 

From a technical perspective, the price is trying to move and maintain the price above the 200 bar MA on the 5 minute chart at the 1.4986 level. The price trended below this moving average level since last Thursday when it last broke at the . Today the price has been able to extend briefly above on a few occassions but the moves are unimpressive and the price has dipped back below at the 1.5295 area. The pair has been consolidating at the lows with little in the way of upside momentum.  The high today reached 1.5026 in the first hour of trading. The close from Friday came in at 1.5015.  These levels will be eyed on the topside as resistance levels.  A break above each will be needed to spur on additional short covering. The upside targets on a break would look toward the 1.5082 level which is the 38.2% of the move down from March 18th (see chart above). 

On the downside, the 100 bar MA on the 5 minute chart comes in at 1.4969 and will be eyed as support for the pair.

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