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Gbp/Usd has just begun selling off going into the European morning. If the pair moves to the downside it should find some support at the 61.8% Fibo (1.6152). This support may only be short lived as we see a move to the upside on Oct. 15 give this level no recognition. If the news that comes out of the Pre-Budget release is as negative as some fear a move down to 1.59 handle is not out of the question.

To the topside 1.6290 is a strong level of resistance, marking the 50% Fibo retracement.

The USD is trading mixed to lower in choppy trade, JPY trades higher, weaker than expected Japanese GDP sparked selling of equities and additional deleveraging of carry trades, European currencies mixed with GBP pressured by report of widening UK trade gap and concern about UK exposure to Dubai World debt,…

As we had mentioned in previous analysis, after the break of 1.4800,next important support emerges at 1.4630-70 and these levels were reached (low at 1.4669). These levels are very important because of the lower part of the wider upward channel, previous lows that led to 1.5140 tops and the 38.2%…

Overall, the major currencies found buyers throughout the overnight trading hours, something that has sent the dollar index below the 76.00 area once again. The gains in the foreign exchange market come as a surprise to some, since both the European and the Asian equity markets were surrounded by negative…

Alistair Darling’s Pre-Budget report today is apparently the only thing that can prevent Britain from losing its AAA credit rating. Moody’s, the leading ratings agency, dropped this bombshell yesterday as the Chancellor prepared to deliver his statement to Parliament. 

 Darling’s team has already made clear that there will be no early move to tighten fiscal policy beyond that already put forth during the last Budget. This could signal a debt downgrade which would have disasterous effects on the GBP.

Concerns regarding the banking industry and weak manufacturing figures added to the market’s sell off of sterling yesterday. The risk of downgrade to the UK has been prevailing factor in trading recently and it appears the risk is increasing.

The Pre-Budget report is to be released at 7:30 EST.

The U.K. released its pre-budget report for the new fiscal year 2010/2011 at the time where the labor party is seeking to pull the British economy out of the worst recession since WWII as well as getting support before the coming elections which will take place by mid-2010. Alistair Darling…

Market fears surrounding the Euro-zone are liable to increase further in the short term with expectation of further credit-rating downgrades and speculation that there will need to be ECB-led bailouts to prevent a debt default. The Euro will also tend to be undermined by the general deterioration in risk appetite….

Cable has surged during the day after breaking below the 1.6250-20 Support. The rise we had mentioned is likely to be contained near 1.64 and thereafter the pair may fall towards 1.5906 (200-DMA) pretty soon. Having broken below the crucial Support, the pair has rendered itself very bearish.

* Times listed are GMT

* Times listed are GMT