Forex - Further Credit Worries in the UK; British Pound tumbles

Forex News and Events: The British Pound is trading a figure below its opening, now at 1.9655, as news spread that a mortgage lender in the UK will issue a profit warning. The Bank of England continues to express concern over inflation and the credit markets. Investors will be looking for the summary of the BOE’s meeting this Thursday for indications of any further concerns. The Euro remains steady at 1.5535 against the US Dollar as Fed commentary points that rate cuts are on hold, for now. Central bank meetings this week will reveal inflation views and commentary on the spectacular rise in oil prices. Swiss GDP figures were announced, showing a drop in growth to 0.3% q/q (versus 0.9% previous revised). This numbers shows a moderate slowing of the Swiss economy but projections for the remainder of the year are very favorable.

Today's Key Issues (time in GMT): 08:30 GBP M4 Money Supply (MoM) (APR F) 08:30 GBP M4 Money Supply (YoY) (APR F) 08:30 GBP M4 Sterling Lending (British Pound) (APR F) 08:30 GBP Net Consumer Credit (British Pound) (APR) 1.0B vs 1.2B 08:30 GBP Net Lending Sec. on Dwellings (GBP) (APR) 6.8B vs 6.9B 08:30 GBP Mortgage Approvals (APR) 65K vs 64K 08:30 GBP Purchasing Manager Index Mfg. (MAY) 50.5 vs 51.0 13:30 EUR ECB's Trichet, Germany's Merkel, EU's Juncker Speak 14:00 USD ISM Manufacturing (MAY) 48.5 vs 48.6 14:00 USD ISM Prices Paid (MAY) 83.3 vs 84.5 14:00 USD Construction Spending (MoM) (APR) -0.6% vs -1.1%

The Risk Today: EurUsd downward pressure remains strong below 1.5664. Currently at 1.5535 and targeting 1.5462 on the downside. A rush back up to 1.6000 is the ultimate risk on the upside. GbpUsd continuing its medium-term downtrend and targeting 1.9364. A break above 1.9974 would threaten the bearish bias. UsdJpy The critical level for today is 104.61, as it is a strong support. Looking for a bounce off the line and continue a bigger breakout to the upside, above 105.31. Falling below 104.61 opens the door to 103.50. UsdChf The target is 1.0610. Strong support holds all the way down to 1.0366.

Resistance and Support: EURUSD GBPUSD USDJPY USDCHF 1.6019 K 2.0399 S 111.92 K 1.1191 K 1.5921 M 2.0101 T 110.10 T 1.0625 T 1.5819 S 1.9849 S 105.70 M 1.0582 M 1.5535 1.9616 104.86 1.0410 1.5287 K 1.9550 M 102.60 M 1.0302 M 1.5200 S 1.9364 K 100.00 S 1.0200 S 1.4962 T 1.9188 S 95.74 K 0.9637 K S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot