The pound is also losing a little bit of ground to start the session
And that is seeing cable move to a session low of 1.2515 as sellers are starting to try and gather more momentum for a move back towards the downside. Currently, price is running into some minor support around the 23.6 retracement level @ 1.2517.
The key support levels to watch out for now in cable are the 1.2500 handle as well as the 200-hour MA (blue line) @ 1.2495. As long as buyers maintain price action above that, the near-term bias will continue to work in their favour.
I still don’t see much good news on the pound side of the equation but for now the market is heavily focused on the dollar side of things. With near-term price action favouring buyers, let’s see if the recent bounce has any further momentum to run.
I would still advocate for selling the pound on rallies but with the dollar looking choppy ahead of the FOMC meeting, perhaps playing it through the yen and euro may present better opportunities in the bigger picture.
For today, with sellers looking to find some control, keep an eye out on the key near-term support levels mentioned above. The risk for sellers at the moment is if price starts trending back above yesterday’s high of 1.2558 towards swing highs around 1.2570-80.