Richard Perry
Independent Analyst
Although the sterling recovery bulls will have been disappointed by the price shying away from the key resistance around $1.6600, the prospect of a near term base pattern is still on the table. Cable has been trading sideways now for 6 days and the resistance at $1.6600 is key as to whether this is just another consolidation or whether there will be a near term bounce. A move above $1.6600 would imply a rebound to $1.6675, however the longer the consolidation has gone on, the more the 6 week downtrend has caught up and is now ready to once more limit any recovery. The downtrend currently comes in at $1.6640. Momentum indicators remain bearish and do not suggest any imminent prospects of a rally that will be anything more than simply another chance to sell if it is seen at all. With the configuration of the technicals, I expect further weakness towards the March low at $1.6460 in due course.
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