Karen Jones, Head of FICC Technical Analysis at Commerzbank, hints at the likeliness that the current downside in Cable could be facing its last days.
“GBP/USD has executed a hammer reversal pattern just ahead of the 50% retracement at 1.2830 – what does this mean? It means that it is likely that the move lower is probably over for now. The market has also reversed just ahead of 1.2808 the 55 day ma – this guards the1.2669/62, the August low. The intraday Elliott wave counts are negative and we will hold onto our newly established shorts for today”.
“Intraday rallies will now find resistance at 1.3027, the 200 day ma, and will stay offered below here. Above here should be enough to cast our eyes back to the 1.3217 recent high”.