The US dollar stated the new trading week with Sunday gaps against many of its peers. For the pound, this was an opportunity to break above the 1.6747 level which was the peak seen in May 2011. So now, cable trades at the highest level since November 2009 – 4 years and 3 months.
1.6767 is the new high. While liquidity is still relatively low, the move seems to hold ground Japan joined the early trade.
Another small factor supporting the pound at the early hours of the week is a strong rise in house prices. According to Rightmove, prices rose 3.3% in February from January and 6.9% year over year.
The next line of resistance is 1.6877, which was a peak back in 2009. The post crisis high of 1.7042 is the ultimate level of resistance. 1.6747 turns into immediate support, followed by 1.6668.
Here is the weekly chart:
This is a very strong start to a very busy week which features inflation numbers, employment data, the meeting minutes and retail sales.
For everything about the pound, see the Pound USD forecast.
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