One of the major beneficiaries of month-,.....>

CABLE: One of the major beneficiaries of month-, year-end demand, cable had seen

recovery extension from its post election pullback low of $1.2905 to $1.3284,

closing the year at $1.3262. However, the eventual break of support at $1.3200

ahead of Thursday's NY open opened a deeper correction down to $1.3116 before

closing the day at $1.3142. Rate extended this recovery to $1.3160 in Asia

before risk took a knock from reports of a US strike on Iranian military leaders

in Baghdad. Rate was pressed down to an extended low of $1.3106, retaining a

bearish feel in early Europe. However, this corrective move lower not seen with

any major momentum, more regarded as orderly despite this conditions. EUR/GBP

recovery so far holds below its key 10-dma which if remains the case keeps alive

a sterling recovery. A break above (10-dma GBp0.8521) would add further pressure

on the pound and could place support into $1.3100 under threat. Break to expose

$1.3075/65 ahead of $1.3050. Resistance $1.3160. 

- UK lending data due at 0930GMT. US Mfg ISM data due at 1500GMT.