Sterling retains a strong undertone, cable....>

CABLE: Sterling retains a strong undertone, cable having extended its recent

recovery to $1.3120 on Wednesday, with Asia retaining the strong buoyant tone

into Europe. The pound has attracted further demand, suggested model fund buys,

and cable extends on to $1.3143, as EUR/GBP begins to pressure the base of its

1.0% 10-dma base at Gbp0.8438. Expect some resistance into $1.3150, more close

behind at $1.3160/65 ahead of $1.3185/1.3200. Support seen back at $1.3085/80.

General election getting closer and short sterling positions getting squeezed as

polls continue to suggest a Conservative win with a working majority. However,

early warnings that the Christmas period could prompt some election complacency,

and suggest that the Conservative lead in the polls may not be as strong as

predicted, starting to get some airplay. 

- A light UK calendar Thursday. Focus on US data.