Britain’s CCC number came in below analyst expectations as we figured, and the Pound is experiencing relative strength in reaction to the news.  The GBP/USD is running higher with gold while crude and the S&P futures try to break out of their chains.  Additionally, we notice the 30 Year T-Bond futures are tanking again, indicating investors are jumping back into riskier assets. 

The Cable has proceeded to leap through our 2nd tier downtrend line, and is currently facing our 3rd tier uptrend line.  We’ve yet to witness abnormal volume on the buy side in either the Cable or the EUR/USD, which is a little intriguing/discouraging as far as the sustainability of the present rally is concerned.  Regardless, the topside progression is impressive, and bulls are trying to make a statement after Intel’s earnings report blew away analyst expectations after the bell yesterday. 

The GBP/USD is back in the thick of the June trading ranging, meaning if the currency pair doesn’t break out of the lid of the range soon, it could duck and revert to another period of consolidation.  We’ve readjusted our 3rd tier downtrend line accordingly, running it through June highs.  Meanwhile, the 1.65 level should serve as a temporary psychological barrier should it be reached.     

The large drop in the CCC sends the data point to a more respectable level, showing Britain’s labor market continues to improve.  In addition to the CCC report, the average earnings index came in two basis points above analyst expectations at 2.3%.  The rise in average earnings along with a declining CCC indicates British citizens may feel more comfortable increasing their level of consumption. 

Therefore, all is good this week on the British front after a shaky couple weeks.  Britain’s done on the economic data front for the week, meaning the Pound should continue to enjoy relative strength for the next few sessions.  Investors should keep an eye on volume since a lack of considerable action on the buy side could prevent the rally from achieving a large technical breakout. 

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