Cable – bulls to resume after shallow correction; 200SMA eyed
|Cable eased to 1.2550 zone in early European trading on Tuesday, after being flat in Asia, following Monday’s spike to fresh multi-week high at 1.2613.
Probe above strong barriers at 1.2568/ 80 (24 / 09 Feb highs) so far did not result in close above them to confirm break.
Current easing could be seen as correction (signaled by reversal of slow stochastic from overbought zone) before broader bulls resume.
Sustained break above 1.2568/80 triggers is needed to open way towards targets at 1.2689 (falling 200SMA) and 1.2704 (02 Feb high).
Dips were so far shallow and held by initial support at 1.2550 zone, however, deeper correction cannot be ruled out.
Rising daily cloud offers strong support at 1.2420, reinforced by ascending daily Tenkan-sen, which should contain extended downticks.
Sterling may show stronger volatility during these days, as official divorce process between the UK and the EU starts tomorrow.
Res: 1.2580; 1.2613; 1.2671; 1.2689
Sup: 1.2550; 1.2523; 1.2500; 1.2467
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