The cable extended losses for the third consecutive week as well. The cable managed to rebound 200 pips from its lows. It still remains below 50Wsma at 1.5600. The 20Wsma is found at 1.5270. At Friday’s session, the cable managed to close above 100Dema and 20Dsma.
The Greek crisis still remains in the limelight this week as well. Besides, the CPI y/y is due on Tuesday and Claimant count change is due on Wednesday. Apart from these, it is a quiet day for the British pound. Until Greece steams evaporate, the euro is likely to be the speculators’ choice and USD will benefit.
Technical view: Last week, the cable closed below 50Wsma at 1.5630 rejected at 1.5780. This week, the cable is at 1.5525 and 200Dema at 1.5550 after losing 50Dsma. The same levels are going to act as strong resistance in coming weeks. The nearest support is found at 1.5270 100Dema and 1.5260 20Wsma. The cable fell below a 3-month ascending trendline, testing the fate at 100Dema. In case of a daily close below 1.5260, bears will retest the previous swing low of 1.5170 initially. Bulls’ real problem will arises if the price closes below 1.5260 opening gates to retest the previous low of 1.5170 initially and 1.5090, 1.5040, and 1.4900 later.
We have been repeatedly advising to buy with sl 1.5260 on a 2-day closing basis. As of now, 1.5550 was hit, minted 250 pips from the buying level.
The intraday resistance is seen at 1.5520 and 1.5550. The support is found at 1.5490, 1.5460 and 1.5430. For the next couple of trading days, the trading pattern is likely to be framed between 1.5260 and 1.5550. In case bulls successfully manage to stay above 1.5550, they will aim another 100 pips higher. Intraday selling is available below 1.5420 towards 1.5400, 1.5360, and 1.5330.
The material has been provided by InstaForex Company – www.instaforex.com