(May 5 Thursday) The pound was unable to hold its gains at 1.4525 and the rate came off to 1.4450 in Europe (-75 pips) against the advances of the firm U.S. dollar. Despite the rebound to 1.4515, the pound fell once again to the low following the weaker than expected U.K. Services PMI which fell to a slower pace of 52.3 in April versus 53.7 in March, the data came below the median forecast of 53.8.
The market is very thin with the market being closed for a holiday in Japan, German, France and a few other European countries apart from London. The market moves are exaggerated in the absence of liquidity with wide spreads due to lack of market participants.
With the looming June 23 UK referendum, the uncertainty of the BREXIT still weighs on the pound and the outlook of the UK economy. The Bank of England and the UK Treasury have warned of the negative consequences if the referendum outcome results does come to a Brexit.
The 14 day moving avergage is toppish at 1.4522 and the 30 DMA is toppish at 1.4515. The 14 DMA broke the support line at 1.4485.