For almost 2 months the GBP/USD has traded sideways, last week registered the biggest weekly sterling advance over this period.
UK government bonds continue to attract investor interest and sterling advanced against all of its major counterparts.
The positive effect of not being a member of the euro currency block is has offered some opportunity for the UK. Also the government has been prudent in working towards reducing the budget deficit.
The benefits of improved global growth should have a very positive impact on the UK.
The market is still neutral and it will take a break above the 2012 high at 1.5990 to open the way for a retest of the October 2011 highs at 1.6167. Initially next week expectations are that the rate will retest the top of this year's range, but gains beyond this peak will be difficult as traders are nervous about buying the highs.
Short term support sits at 1.5750, the March 13 high and then stronger support is in evidence at the base of the recent range around 1.5600.
HCM GBP/USD Chart
Shayne Heffernan oversees the management of funds for institutions and high net worth individuals.
Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.