Cable is down by nearly 0.5%, close to the 1.3100 handle
It’s been yet another see-saw session for cable as price opened with a gap lower to start the day with the dollar well-bid following Trump’s trade tweets. Traders then filled the gap in a quick 80 pips jump before it all came crashing down again as price closes in on the day’s low currently in the European morning.
Trading sentiment is very much the opposite of Friday’s trade where cable held lower initially before recovering strongly to break well above the 1.3100 handle. Hence, even with the drop today, the gains seen last week are still very much intact for now.
As it stands, bids near the 1.3100 handle and support around 1.3110 is helping to keep buyers well in control of the pair. The near-term bias also remains more bullish despite the drop today, as price holds well above both key hourly moving averages.
For trading bias today, the 1.3100 handle will provide the key area in defining the bias. If buyers can stay above that, it should help to limit declines on the day. However, if price starts to extend below the figure level, I would expect the 100-hour MA (red line) @ 1.3063 to be tested in the sessions ahead.
The pound is mostly holding weaker on cross-selling as GBP/JPY is marked lower as well following the risk-off tone in markets today. North American traders will be the ones to provide the next set of clues for market participants so just be wary of how risk sentiment develops in the following session.