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British Pound finishes Higher; Election Compromise in the Works

Discussion in 'Forex Daily News & Outlook' started by forextrends24, May 10, 2010.

  1. forextrends24

    forextrends24 New Member

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    Today’s sample of Forex Analysis from ForexHound.com

    The GBP USD opened higher driven by spillover buying from the Euro, but by mid-session was trading well off its high. The initial rally was triggered by the possibility that the two major political parties - Labour and Conservative - were working together to map a plan for a balanced budget despite the possibility of a hung parliament.

    The break began when the Liberal Democrats made a formal request to join the coalition. The weakness late in the session demonstrates that investors want to see a clear-cut plan by the next parliament to balance the budget and reduce the deficit. The request by the Liberal Democrats to join the Labour and Conservative parties at the planning meeting made traders nervous about the possibility of a hung parliament.

    The strong rally in U.S. equity markets helped to drive up the USD JPY. The strong rally was actually a combination of less demand for lower yielding assets and the sale of 2 trillion Yen by the Bank of Japan last week.

    Read full article at ForexHound.com as well more Forex Trading articles including Forex Technical Analysis and Forex Education

    Disclaimer: Trading foreign exchange on the margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore should not invest money that you cannot afford to lose.
     
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