Don't forget that you can now follow's research team on Twitter:

Post the dismal PMI data released earlier , it suggests it not just a long bank holiday to celebrate the Queen's Jubilee is getting in the way of UK growth, weak orders from the US, Asia and Europe are also weighing heavily on the UK's growth prospects.

UK PMI manufacturing falls sharply to 45.9 from 50.5 in April. The lowest level since May 2009. Very weak sub-indices too, new orders fell to 42.00, which was the low since the bottom of the recession in 2009. This does not bode well for the UK growth in Q2. This is very deflationary, supports more QE and is sterling negative

Cable falls below 1.53 to 1,.5290 - the lowest level in over a year.

Although cable looks very oversold, fundamental and economic factors seem to be dominating at the moment. Below 1.5290, there isn't much short term support until 1.5200. The pound seems to be following the euro. Back in 2010, while the euro fell to below 1.20, cable fell to below 1.45, so there could be more downside to come...

GBPUSD weekly chart... although shorter term indicators suggest this pair is oversold, the long-term chart suggests there could be more weakness to come and we remain a way off from the sub 1.45 low we reached in 2010.


Best Regards,

Kathleen Brooks| Research Director UK EMEA |

d: +44.(0).20.7429.7924 | f: +44.(0).20.7929.2010 | M: +44 (0) 7919.411.957 | e:| w:

23 College Hill | 3rd Floor | London EC4R 2RT

Now you can follow us on Twitter:

Disclaimer: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that is not rendering investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. is regulated by the Commodity Futures Trading Commission (CFTC) in the US, by the Financial Services Authority (FSA) in the UK, the Australian Securities and Investment Commission (ASIC) in Australia, and the Financial Services Agency (FSA) in Japan.