Cable inches lower as dollar holds steady on the session
The dollar and the yen are leading the charge ahead of European trading and that is seeing cable move a little lower. The range for the day remains relatively narrow (34 pips) but we’re trading close to the bottom of that currently.
There is minor support from the 1.3000 handle but key near-term support levels lie just below it. There is a confluence of support levels to help buyers find an area to lean on between 1.2965 and 1.2970. That comes from the lows seen yesterday, the 100-hour MA (red line), and the near-term trendline support.
The pound itself had a rather volatile trading session yesterday but recovered into the close as risk sentiment improved with US stocks trading higher to end the day. However, the new day so far has seen rather subdued risk sentiment with bond yields trading lower alongside Asian equities.
US equity futures are flat for the most part, so that’s something that European investors can point towards to not follow suit in the mild negative tones to start the day. As for the pound, expect trading to be very much similar to yesterday. Risk sentiment will help to push and pull cable as it affects dollar sentiment. However, at the end of the day the key driver will be the Brexit rhetoric.
Support– 1.2965-70 (as mentioned above)- 1.2934 (200-hour MA)- 1.2904-17 (200-bar MA on H4, 100-bar MA on H4)- 1.2900 (swing region, bids)
Resistance– 1.3043-50 (swing region)- 1.3083 (76.4 retracement level on H4)- 1.3100 (offers)