Fresh market-moving influence over cable will be exerted by the 13:30GMT publication of December's US employment report. Tripped stops below 1.9400 helped depress sterling to a six-week low of 1.9351 during today's Asian session, amid heavy selling of GBP/JPY re: the further unwinding of carry trades.
In plumbing that 1.9351 low, GBP/USD took the cumulative size of its drop from Wednesday's four-week high of 1.9752 to four cents. Much of the blame for that four cent decline has been pinned on a perception that the risk of a higher UK base rate has been "over-priced". Bids are tipped at 1.9350/55, with some stops touted below 1.9350. The latter level approximates to a 38.2% Fibo retracement point of the ascent from 1.8520 (Oct 16 low) to 1.9849 (Dec 1, 14-year high).
Cable pushed its recovery envelope from its 1.9351 Asian session low to a high just shy of 1.9435 (Dec 18 base) in early European trade, just before the 08:00GMT disclosure of softer-than-expected UK house price data. According to the Halifax, UK house prices fell 1.0% in December.
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