Chart: WorldWideMarkets Alpha Trader
Cable rebounded from the low of 1.6320 after an industry report showed the U.K. house prices increased for a 10th month in November. The Halifax of mortgage units of Lloyds Banking Group reported that British house prices rose 1.1 percent in November from 0.7 percent in October.
The pound rose 50 points in Europe from 1.6320 to 1.6370 against the softer dollar in a cautious market prior to the U.S. Employment Data. Cable was bid in the European morning session with good reason after the better than expected U.K. Halifax housing prices and comments from Moody’s rating agency. The housing data is only a small fraction of the U.K. economy structure. Nonetheless, the data showed promising signs that the U.K. economy is on a recovery path. In addition to this, the Bank of England kept its monetary policy unchanged yesterday and gave no indication of adding further QE measures.
Moody’s rating agency said that “Improved UK prospects is credit positive and UK fiscal challenges are reflected in their Aa1 rating with a stable outlook.
The median forecast for the U.S. Nonfarm Payroll is +185,000 in November compared to +204,000 in the previous month of October. A number lower than this, would push the dollar lower and conversely, push cable higher above 1.6400 or to the 1.6500 territory.
Support: 1.6320, 1.6300, 1.6260, 1.6205
Resistance: 1.6370, 1.6405, 1.6440, 1.6450