Follow-on selling drops rate, cross-spreaders on the sell side of the sterling pairs kept the rate under pressure. Thin two-way action. Stops under the 1.5500 area drop rate into next support area around 1.5400. Technical trade overnight. Resistance at 1.6000 likely to cap near-term.

Likely more bad news also due this week which will pressure calls for another BOE rate cut next month but that might be factored in. Traders note unwinding of Yen cross-spreads driving a lot of trade after the open.

EURO/GBP still near a record high encouraging a round of profit taking soon I think. Traders note liquidity is only moderate and still on the lower side. Aggressive traders can look to buy the next dip. Expect more whippy action. Two-way action likely to continue.

GBP/USD Daily

Resistance 3:  1.6320/30
Resistance 2:  1.6250
Resistance 1:  1.6100/10
Latest New York: 1.5402
Support 1:  1.5380
Support 2:  1.5280/1.5300
Support 3:  1.5220

Data due Wednesday: All times EASTERN (-5 GMT)

4:30am GBP Claimant Count Change
4:30am GBP Average Earnings Index 3m/y
4:30am GBP Unemployment Rate
5:30am GBP BOE Governor King Speaks
5:30am GBP BOE Inflation Report

Forex Analysis by Jason Alan Jankovsky at ForexPros.com. For more details about Forex Trading and Tips for decent earnings through Forex Trading, Please check http://www.forexpros.com