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The British Pound Sterling rate is traded downward at the Forex currency market on Monday, following some negative European news.

Forex forecast: MACD indicator for the pair GBP/USD is traded in the negative area and is going down moderately, while volumes are increasing, and is giving a sell signal. Stochastic Oscillator tends to go out of the oversold zone, giving a weak buy signal.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at 1.5330, buyers' targets will be the levels of 1.5345 and 1.5350 as part of correction. There is a high chance that aggressive sellers will be back in the pair, aiming to 1.5270.

A lot of negative information from Eurozone and rating agencies prevented the Pound to continue correction and a surge of sales, which was caused by risk aversion, has led the pair to the local lows. It is quite possible that sales, which are of emotional nature, have not yet completed.

The data released today showed that house prices Rightmove in the UK dropped by 0.8% m/m (+0.4% y/y) in January. Research Group stated that asking prices fell three times this month; however interest to the British real estate sector is still preserved. Meanwhile, according to experts' estimate, situation in the sector remains "complex" in 2012, as unemployment rate is increasing and impact from European problem is not waning.

According to the data released earlier, house prices in the UK fell by 16% in December, as per RICS estimates. The Pound has neglected this statistics, concentrating on the external background.

At the meeting which was held last week, the Bank of England left interest rate at 0.50% per annum, volume of securities repurchase was also kept unchanged at 275 billion pounds. In other respects, views of MPC remained unchanged: there is no need to revise interest rate; therefore the Bank will continue to monitor economy and inflation.

It is worth noting that the Bank of England expects economic stagnation in Q4 2011 and GDP growth in Q1 2012.Revised GDP in the UK rose by 0.6% q/q (+0.5% y/y) in Q3.

Statistics released earlier showed that the UK retail price index BRC increased by 1.7% m/m in December against the rise of 2.0% a month earlier. Thus, the index fell to 16-month lows, largely due to Christmas sales, when retailers reduced prices. Prices declined by 0.1% on monthly basis.

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