Cable stands at the front foot ahead of UK inflation data

Slobodan Drvenica Windsor Brokers

GBPUSD

Cable remains positive in early Tuesday’s trading and pressures Monday’s high at 1.3875, but recovery attempts from Friday’s low at 1.3764 so far did not show stronger gains and remain capped by broken ascending 30SMA (currently at 1.3873).

Lack of clearer direction signals comes from mixed daily indicators as slow stochastic is emerging from oversold zone and pointing higher, while 14-d momentum continues to trend lower, deeply in negative territory.

Traders are cautious ahead of today’s key event for sterling, release of UK CPI data. Inflation is forecasted at 2.9% in January vs 3.0% in Dec and under six-year high at 3.1%, posted in Nov.

Stronger than expected release would inflate pound as strong inflation would support hawks advocating scenario for rate hike in May.

Disappointing numbers, on the other side, would increase pressure and risk extension of pullback from 1.4344 peak.

Bulls need break above 30SMA (1.3873) and daily Kijun-sen (1.3901) to generate fresh bullish signal for extension towards psychological 1.4000 barrier (20SMA) and 1.4020 (daily Tenkan-sen).

Res: 1.3873; 1.3901; 1.3960; 1.4000
Sup: 1.6832; 1.3796; 1.3764; 1.3700

Interested in GBPUSD technicals? Check out the key levels

1 Week
1 Month
1 Quarter

1 Week

Avg Forecast 1.3848

35% Bullish
45% Bearish
20% Sideways

Bias Bearish

1 Month

Avg Forecast 1.3882

47% Bullish
53% Bearish
0% Sideways

Bias Bearish

1 Quarter

Avg Forecast 1.3701

32% Bullish
58% Bearish
10% Sideways

Bias Bearish

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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