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GBP

Pares some gains

BONDS

BTP/Bund spread, tightest since April

GILT AUCTION PREVIEW

0.25% Jul-31

Towards the end of last year we highlighted a key trendline resistance in GBPUSD. This trendline, drawn off the 2007 high, had remained intact until December where it was breached following the break above 1.3372.

  • A strong monthly close in December reinforced the bullish breakout and so far in January, price has remained above the trendline - it currently intersects at 1.3322.
  • These developments highlight a reversal of the downtrend that has been in place since the Nov 2007 highs.