Early sterling slippage saw cable extend......>

CABLE: Early sterling slippage saw cable extend its corrective pullback, away

from its month-end high of $1.2643 to $1.2406 into Monday's NY open, with

EUR/GBP able to push back above Gbp0.8800 before topping out around Gbp0.8814.

However, NY applied added pressure on the EUR which eased the cross back to

Gbp0.8763(though held off easing below its key 10-dma(current Gbp0.8747) which

provided cable with some buoyancy, allowing it to edge back to $1.2451, settling

around $1.2430 into the NY afternoon. Support remains into $1.2400 ahead of

technical supports at $1.2399/89(61.8% 1.2248-1.2643/Apr29 low). A break here to

expose $1.2360(Apr27 low). Resistance $1.2450, $1.2475/80 ahead of $1.2500.

Tuesday brings Svcs PMI at 0830GMT, market expectations for a further weakening

in the flash level of 12.3 to around 11.0. BOE MonPol announcement Thursday

approaching. Most look to June for an increase in QE.