Looking at the GBP/USD chart it would be easy to think that Sterling has been under a lot of pressure over recent months, but it is not until you look at the Pound against a whole range of other major Currencies that you realise Cable is the odd one out - the rest of the Sterling charts have actually booked decent gains.  Indeed, in our weekly Currency review at the start of this week we still had the Pound joint second (with the Canadian Dollar) on a multi-week basis out of the 10 major Currencies we look at in most depth.

The UK General Election is now less than 6 months away.  The date is set for 7th May 2015.  The opinion polls currently show little chance of one party winning the General Election outright, with matters perhaps more confused than usual due to the current strong showings in the opinion polls by UKIP and SNP.  The Conservatives & Labour will need to try and win back their former voters to have any chance of forming the next government, and to do so their proposed policies may have an impact on how the Currency markets view Sterling.  As such, it is possible that as the Election date starts to approach, Sterling could see a significant move.  

With this in mind, we are taking a look here at the longer-term charts of GBP/USD & EUR/GBP, identifying the key support & resistance levels which may come into play over coming months.  

GBP/USD (top chart). The major underlying trend has slight upwards bias. The 2013-2014 advance from 1.4818-1.7186 is currently being corrected, with the 61.8% retracement at 1.5723 now close by.  We see the risk of a breakdown to attack the 76.4% retracement at 1.5377, with the risk of an overshoot to the 1.5067-1.5214 area, where the 2010-2013 & 2009-2013 uptrend lines currently intersect (these are rising approximately .0004 & .0006 per week). To the upside, the 2011 & 2009 highs at 1.6745 & 1.7041 are likely to revert to strong resistance ahead of the 2014 peak at 1.7186.  Successfully clearing 1.6745-1.7041 would point at a further advance to new multi-year highs.

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EUR/GBP (lower chart). The major underlying trend is down with key support initially noted at the 2012 low at .7757 and then the 2000-2007 uptrend line which currently intersects at .7529 (rising .0002-.0003 per week).  With the 13, 52 & 260 week moving averages bearishly aligned and falling the risk is for a breakdown through the 2000-2007 uptrend line towards the bases of the 4 & 5-6 year bear channels which currently intersect at .7410 & .7084, falling around .0003 & .0004 per week.  In the event of a recovery phase, we ideally now seek a sub .8399-.8400 lower top by the .8159-.8280 area, although an overshoot of the .8399-.8400 area towards the top of the aforementioned bear channels which currently intersect at .8480 & .8575 are not ruled out, without signaling a lasting trend change. 

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