Cable edged lower in early Wednesday’s trading, after spiking to new highest level since 24 Mar (1.3215) on Tuesday, as the latest polls showed a narrowing lead of Conservative Party (28 seats majority vs 68 two weeks ago) that also increases risk of a hung parliament.
Bulls repeatedly failed to close above cracked Fibo barrier at 1.3167 and also returned below cracked bear-trendline (1.3184), with last two daily candles with long upper shadows, giving initial signals that bulls might be running out of steam, following impressive 8.2% advance in past four months.
Daily momentum is neutral, stochastic reversed from overbought and heads south while RSI is emerging from overbought territory, adding to negative signals.
Initial support at 1.3100 (last Friday’s low) so far contained dip, but near-term action remains biased lower after bulls faced strong headwinds from 1.3167/84 pivotal barriers and also being hurt by disappointing news.
Loss of 1.3100 handle would risk deeper pullback and expose rising 10DMA (1.3060) and key 1.30 support zone.
The pair is expected to be mainly driven by election speculations on Wednesday, as many voters are still undecided, with extended range-trading seen as likely characteristic of the day preceding election.
Res: 1.3167, 1.3178, 1.3215, 1.3247
Sup: 1.3100, 1.3060, 1.3012, 1.2984
