EUR/GBP: A Bear Flag?

EUR/GBP failed to break above the resistance at 0.7080 and bounced off that level. It reached the support at 0.7010 on the daily filter chart, formed a doji candlestick and moved to the upside again, so it is very possible that it will attempt to test the resistance level yet again. That said, the pair is forming a rather clearly defined bear flag pattern, so even if it reaches the resistance at 0.7080 I would be on the lookout for any candlesticks that indicate a new move to the downside. Either way, for now there is not signal that the bearish trend is over.

Leading Oil Companies Are Queuing in Iran

Total SA, Royal Dutch Shell Plc and Lukoil PJSC are some of the international companies that have picked oil and natural gas deposits to develop in Iran as the country, which is the the holder of the world’s fourth-largest crude reserves, presents $30 billion worth of projects to investors.

Total is one of the companies that have been in the forefront of discussions and Eni SpA is also looking to invest, Oil Minister Bijan Namdar Zanganeh said. Shell, Total and Lukoil all specified fields they would be interested in developing in Iran, Ali Kardor, deputy director of investment and financing at National Iranian Oil Co. said in an interview in Tehran.

“Many companies are interested. Europeans are interested, Asian companies are interested,” Zanganeh told reporters at a conference in Tehran on Saturday. “Total is interested, Eni is interested.”

Iran is pitching 70 oil and natural gas projects valued at $30 billion to foreign investors at a two-day conference in Tehran that started today as the Persian Gulf country prepares for the end of sanctions that have stifled its energy production. All banking and economic sanctions will be lifted by the first week of January,” Amir Hossein Zamaninia, deputy oil minister for international and commerce affairs, said at the event.

“We are interested to come back to Iran when the sanctions are lifted and if the contracts are interesting,” Stephane Michel, Total’s head of exploration and production in the Middle East said at the conference. “We have worked in this country for a long time, so we know specific fields on which we’ve worked.”Representatives of Lukoil and Shell declined to comment at the conference.

UK Economy Has Grown by 0.5%

Unchanged from the initial estimate official figures confirmed that between July and September the UK economy grew with 0.5%.

It is the second estimate for GDP growth from the Office for National Statistics (ONS).

It was a slowdown from the 0.7% rate in the second quarter, but still marked the 11th consecutive quarter of growth.

A widening trade gap is being blamed for the slowdown, with trade having a record negative effect on GDP.

The deficit in the trade balance, the gap between the level of exports and imports, widened from £7.7bn in the second quarter to £14.2bn in the third.

Exports increased by 0.9% while imports grew by 5.5%.

Overall, the trade gap knocked 1.5 percentage points off GDP, which is the most since records began in 1997

Construction output was also a drag on growth, with the sector contracting by 2.2%.

The services sector, which accounts for more than three quarters of the economy, grew by 0.7% in the quarter.

Industrial production, which includes manufacturing, grew by 0.2%, and business investment was estimated to have risen by 2.2%.

"No surprises in the second estimate as the economy was ticking over, including a chunky contribution from business investment, which has had an unbroken run of expansion for a year," said Lee Hopley, chief economist at EEF, the manufacturers' organization.

"Pulling sharply in the opposite direction is the contribution from net trade, with modest export growth being swamped by a massive bounce in imports.