Pound resumes slide after BoE Inflation Report

By IBTimes Staff Reporter | February 10 2010 6:34 AM

The U.S. economy later on today is releasing its trade balance in which it is expected that the trade gap will narrow and this will support the dollar as currently it is mixed in trading, declining versus the strong euro while climbing past the weak pound. The Dollar Index, which usually measures strength of the dollar versus six major currencies, is currently traded at 79.71 while recording a high of 80.01 and a low of 76.65.

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The euro extended its gains in the market ahead of tomorrow's European officials meeting to discuss ways to help Greece narrow its budget deficit as a way to avoid the deficit from spilling over to other economies in the Europe region. The EUR/USD pair is currently traded at 1.3802 between the support of 1.3705 and the resistance of 1.3825 while recording a high of 1.3811 and a low of 1.3733. The momentum indicators show us that on the one-hour charts, the trend is upwards although there is low volume in the markets.

The Bank of England released its quarterly inflation report which showed that production output in the last six months of year stabilized while it is projected that economic growth will improve gradually. The weaker pound was said to also support growth as it boosted exports. Now, if we look at the pound dollar pair we see that they are declining on a daily basis while the pair is currently traded at 1.5671 between the support of 1.5580 and the resistance of 1.5745. So far the pair recorded a low of 1.5648 and a high of 1.5763.

The dollar yen pair is declining on the daily charts while we see that the pair is consolidating between the support of 89.30 and the resistance of 90.00 at 89.67. The momentum indicators on the one-hour charts provide us with a sideways wave while the pair recorded a high of 90.00 and a low of 89.52.