Cable tested 1.9720 offers late in the European morning, after pushing its recovery envelope from yesterday's 10-day low of 1.9592. The USD is suffering on fears that the US sub-prime crisis might be spreading to higher-quality loans, re: yesterday's dividend slash and 2007 profit-warning from American Home Mortgage (The Times). The greenback is also being negatively impacted by trade tensions between the US and China.
Additional sell interest is tipped at 1.9735, a 61.8% Fibo retracement point of the fall from 1.9823 (Apr 3, 10-week peak) to 1.9592. Further offers are noted at 1.9770. Prior sell orders at the latter level kept a lid on GBP/USD last Wednesday and Thursday, before the "unchanged" BoE base rate verdict. 1.9700 (today's Asian session peak) is now a pullback support point.
Lower props include 1.9660/70 and 1.9614 (today's Asian session base). The Fed's Mishkin, Fisher and Plosser are respectively slated to speak at 13:30GMT, 17:00GMT and 23:30GMT. Minutes from the March 20/21 FOMC meeting will be published tomorrow (Wednesday).
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