Richard Perry
Independent Analyst
Yesterday I focused on the fact that I no longer saw this as a potential top pattern above support at $1.7100 as the sideways trading had gone for too long. I now see this as a consolidation period that will ultimately end in the next leg higher. The only question is whether the bulls will get a nice dip as another opportunity to buy. The reaction to last night's FOMC minutes was positive and added around 50 pips to Cable so there may not be that opportunity. Momentum indicators retain a positive configuration, whilst this consolidation is also giving moving averages a chance to catch up. The intraday hourly chart shows a very positive set up on all moving averages and momentum now. I would now view any correction back towards $1.7100 or even $1.7060 as a chance to buy. Once the break above $1.7179 is seen there is little to stop Cable until the 50% Fibonacci retracement of the huge bear market of 2008 at $1.7330.
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