Cable holds negative tone in early Thursday’s trading, after the action on Tue/Wed was strongly rejected in both directions and left two long-legged daily Doji candles, signaling strong indecision.
Negative momentum and repeated failures to clear falling 10SMA (currently at 1.2763), keep near-term bias with bears for renewed attempt through key supports at 1.2695/61, after bears spiked to 1.2658 low on short-lived action.
Traders remain very cautious, as parliament debates about Brexit deal and will vote on it on 11 Dec.
With very strong Brexit opposition, possibilities that the deal will not be approved are high.
Fears rise on scenario of disorderly Brexit, which could have strong negative impact on the UK economy.
Bearish scenario on sustained break below 1.2695/61 pivots, would risk acceleration towards next strong supports at 1.2500 zone.
On the other side, close above 10SMA would ease persisting bearish pressure, but stronger bullish signal could be expected on lift above falling 20 and 30SMA’s (1.2816 & 1.2857 respectively).
Res: 1.2737, 1.2763, 1.2816, 1.2857
Sup: 1.2695, 1.2671, 1.2658, 1.2600
