Early pullback into Europe again stayed shy...>

CABLE: Early pullback into Europe again stayed shy of key technical support at

$1.2250(76.4% $1.2076-1.2813), as well as Monday's low of $1.2252, touched

$1.2258 before it recovered to $1.2289 ahead of the NY open. Stronger demand

emerged in the US session, suggested to be on the back of the firm Dow opening.

Move caught the market short with covering fuelling a rise to $1.2392 through

the month-end fix (some talk of RHS GBP/AUD in the move). Strong sales of

EUR/GBP also seen (cross was held within the topside of its 1.0% 10-dma envelope

this morning, rejected away by still holds above its 10-dma, current Gbp0.9049,

keeping underlying tone buoyant. Cable backed off to $1.2357 post fix but holds

most of its gains into the US afternoon. Support into $1.2300, stronger at

$1.2250. Resistance now seen from $1.2390 through to $1.2420.

- Wednesday brings UK final Mfg PMI at 0930BST. BOE Haskel speaks at 1200BST. 

- US ADP (ahead of Thursday's early release of NFP), ISM Mfg, Construction

spending and FOMC Minutes. 

- Expect some month-end carry over though risk will again provide the main

directional drive.