Cable extends weakness (down 0.46% in Asia/early Europe) on Thursday and hit two-week low, following negative signal on eventual daily close below 20DMA.
The sentiment weakens further on growing worries that the Bank of England may introduce a zero rate, although most of economists expect no changes on today’s BoE policy meeting, but some believe that the central bank would cut rate to zero and increase its QE program by 150 billion pounds.
Pound will get a shock if the BoE opts for 0.10% rate cut to zero and may accelerate lower in such scenario.
Fresh bears focus pivotal supports at 1.3508/02 (55DMA/Fibo 23.6% of 1.2675/1.3758), violation of which would add to reversal signals and open way for further weakness. Daily techs are turning to bearish mode and maintain pressure, with broken 20DMA marking pivotal barrier (1.3651).
Res: 1.3620, 1.3651, 1.3674, 1.3710
Sup: 1.3573, 1.3519, 1.3502, 1.3444
