Cross touched a fresh YTD high of.....>

EURO-STERLING: Cross touched a fresh YTD high of Gbp0.8744 Tuesday as cable's

react to the mid-meeting Fed 50bp rate cut trailed EUR/USD's stronger move.

However, EUR/USD's corrective pullback also outpaced cable's which allowed the

cross to ease to Gbp0.8696 before rallying back to Gbp0.8742, closing the day at

Gbp0.8718. Rate drifted off through the Asian session, touching a low of

Gbp0.8700 in early Europe before fresh demand emerged into the dip. Rate

currently trades around Gbp0.8717. 

- Rate has eased away from the top of its 3.0% 10-dma envelope, by time has

risen to Gbp0.8778, but so far remains above its 2.0% envelope (current

Gbp0.8693). Whilst rate remains above the 2.0% line, keeps current underlying

buoyant tone in place. 

- MNI Techs note that Friday(Feb28) saw cross breach a key resistance at

Gbp0.8592(Dec23 high) and seen as an important swing in the daily chart,

highlights a clear reversal of the Aug - Dec downtrend.

- If this is a key reversal, chances of a M/T recovery to Gbp0.9000, and top of

the range around Gbp0.9300 have increased over the past week.