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The Pound is consolidating important gains against the
Dollar as it hovers around 1.5160, 200 pips above daily lows. GBP/USD
rallied from 1.4963 to 1.5190 (session high) and erased yesterday's
losses. The pair is posting the biggest daily gains since July 1.
"A report showing U.K. inflation had risen prompted the start of a
short-covering rally overnight. Traders now believe that inflation could
become the key issue which derails the recovery and are pricing in a
possible rate hike by the Bank of England", James Hyerczyk, analyst at
ForexHound.com, said.
The rally of the Pound found resistance below 1.5200 and the pair pulled
back to 1.5145. In the last hours the pair has been steady moving in a
range between 1.5145 and 1.5170.
GBP/USD tested 1.5190 area as optimism spreads and Wall Street
extends gains to 3 digits: DJIA is up more
than 170 points while S&P
accumulates a 25 gains intraday. Pound is back inside the daily
ascendant channel broken with Monday Asian opening, and has
immediate support at the 1.5150 area, base of mentioned channel,
follows by 1.5100, intraday lows congestion zone clear in 4 hours
charts.
Pair has been capped by 1.5230/40 zone past week, retreating
strongly after failing to break the area, turning the zone into
first resistance area for current bullish run.
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