Richard Perry
Independent Analyst
Yesterday’s reaction to the resistance at $1.6600 just shows how weak the outlook for Cable is still. There had been a decent consolidation that had threatened a near term technical rally (within the downtrend) but the strength of the downside momentum and the resistance proved to be too much and once more we saw a negative trading day. Perhaps the bulls will be noting that the $1.6525 low from Monday remains intact, but this is the only positive that can be drawn from this chart. Even on the intraday hourly chart, momentum indicators remain negative, whilst any near term bounce needs to break through the strengthening resistance at $1.6600. Selling into any intraday rebound today looks to be the only real strategy as a test of $1.6525 can be expected, before Cable drifts back towards a test of the March low at $1.6460. Above $1.6600 may give some very near term respite, but there is plenty of further overhead supply to prevent any sustainable rally gaining traction.
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