Richard Perry
Independent Analyst
Whilst there has been a continued sell-off on the euro, this has not been the case with sterling. Cable shows an interesting tussle that has developed between the bulls and the bears, with the battle line drawn at the $1.6600 resistance. This resistance has broadly been what has been holding the bulls at bay now for the past 8 days. To add extra spice, the resistance of the 7 week downtrend is at $1.6625 and is starting to come under serious scrutiny. Furthermore, we have also seen three positive days in a row at the end of last week, something which has not been seen on Cable since early July and before the downtrend began. The intraday hourly chart shows the resistance very well and a confirmed move above $1.6600 would complete a base pattern and imply $1.6675 initially. The prospects of a near term recovery are improving and with the downtrend fast approaching, the next couple of days will be very important as failure now would suggest a retest of the $1.6525 low.
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