Meredith Witney is making some fairly negative comments regarding the health of the financial sector and this will most probably be weighing on sterling. The analyst feels sub-prime asset class is about to take another leg down. Credit was extended too freely in recent years and credit lenders have been caught in a bit of a game of hot potato.
Cable tends to be something of a proxy for the health of the global financial sector. Good news tends to support it, bad news (which these comments are) tends to pressure it. We’ve reached area 1.3970/75 where buy orders were earlier noted. Be interesting to see whether they can absorb this selling pressure. Technical support seen at 1.3950.
