Tech Forecasts: The Pound (GBP), the Euro (EUR), US Dollar (USD) and Today's Exchange Rate Conversions

First, a point of reference is required; here are today's exchange rates, as of the last update (04/09).

• The British pound to euro exchange rate: 0.01 pct lower than on Wednesday night's closing level and converts at 1.2519.
• The British pound to US dollar: 0.07 pct lower, the conversion is 1.6449.
• The euro to dollar exchange rate: 0.08 pct lower, the converstion is at 1.3140.

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Euro to Dollar Forecasts: EUR/USD Could Touch 1.3050

Emmanuel Ng at OCBC tells us:

"Expect the mood towards the common unit to remain heavy as we head into the ECB on Thursday and with the Ukraine/Russian situation still in a flux. On CFTC front, note that leveraged net EUR shorts increased in the latest week with net positioning beginning to look stretched.

"Expect a top heavy posture to prevail at around current levels with the next support expected towards 1.3100."

ICN Financial are also backing the heavy downside pressure to extend:

"This week's trading opened to the downside which is normal in light of breaking 61.8% correction earlier. Stability below 1.3230 at 61.8% correction keeps the possibilities of further bearishness to touch 1.3050 - 1.3020 represented in 76.4% - 78.6% corrections.

"Momentum indicators are showing oversold signals, but we will depend on the negativity showing on Linear Regression Indicators to suggested further bearishness. Of note, breaking the psychological barrier 1.3000 this week extends the downside move in the upcoming session towards 1.2960 and 1.2895."

Pound Sterling to US Dollar Forecast

A new unknown has been thrown into the mix - the referendum on Scottish independence. Scotland votes on the 18th of September and indications suggest the race has narrowed. Markets hate uncertainty and recent unexpected losses will play havoc with the technical forecasts.

We would stay away from the GBP until resolution on Scotland is found as the markets are going to be highly skittish with regards to the GBP.

Scotland aside, Emmanuel Ng at OCBC takes a stab at forecasting sterling's path:

In the near term, the prospect of relatively more hawkish BOE (relative to the ECB) may continue to grant the pound implicit support.

ICN Financial reckon sideways could be the new norm for sterling dollar, and we can't help but agree:

"The pair is still providing sideways trading as Stochastic is still approaching overbought levels supporting the expectations of the bearish correctional move and its main next target resides at 1.6285. Of note, breaching 1.6625 halts the suggested negative scenario and pushes the pair to test 1.6800.

"The outlook is negative below 1.6625, risk-limit above 1.6735."

We also hear today that Swissquote Research have called an end to their positive stance on GBP/USD:

"GBP/USD made new lows yesterday, confirming persistent short-term selling pressures. Monitor the test of the key support at 1.6460. Hourly supports stand at 1.6563 (29/08/2014 low) and 1.6644 (01/09/2014 high).

"In the longer term, the break of the key support at 1.6693 (29/05/2014 low, see also the 200 day moving average) invalidates the positive outlook caused by the previous 4-year highs. Key supports stand at 1.6460 (24/03/2014 low) and  1.6220 (17/12/2013 low)."

Sterling to Euro forecast

Turning to the pound euro forecast, Bill McNamara is bullish:

"After trading down to a low of 1.2482 in the middle of August the UK currency subsequently rebounded to the extent that it posted a (fractional) gain for the month.

"The weekly candlestick chart shows this has lifted it right back up to the upper end of its recent range and the overall impression is that sterling is now in a position to push on through its July peak, at 1.2674, and test its July 2012 high, at 1.285."

Barclays reckon that any bounce in the euro should be punished:

"We continue to believe short EURUSD and short EURGBP are the best expressions of EUR bearishness. The Barclays Technical Strategy team sees similar downside in these pairs, looking for a move towards initial targets near 1.3100 and then 1.3010 in EURUSD.

"The weekly close below channel support near 0.7950 in EURGBP confirm a bear flag and signal a move towards the year-to-date lows near 0.7870. Beyond there, we are targeting the 0.7755 greater range lows."