We retain our assessment that Cable will remain positively configured on a medium term basis whilst the support band $1.2900/$1.3010 remains intact. This band has come under some scrutiny as the market has fallen away in recent sessions, but again the bulls seem happy to support and buy into weakness. Yesterday’s rebound into the close left a positive candle with the market again trading above $1.3000. Whilst this has not been a decisive reaction higher yet, it is encouraging. Dovish Bank of England speakers have been a key driver lower, and there is another speech today from Michael Saunders, so if the support band can get through this speech intact this will add to confidence in the support. Technically, the MACD lines are holding above neutral and RSI still above 40. The hourly chart shows already a recovery building as hourly RSI and MACD lines move into an improving near term configuration. There is an initial near term band of support $1.3000/$1.3010 to also build from this morning. A decisive move above $1.3050 would build on the recovery and open $1.3090 and $1.3125 as next resistance.
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