The pair remains directionless on Monday with price action holding in tight Doji. Rumors of big name suggesting longs just under 1.3300 for fresh upside extension towards 1.3500 zone, keeps the pair afloat and preventing stronger pullback, signaled by overbought slow stochastic on daily chart.
Consolidative phase may extend while falling 20SMA caps, with extended dips allowed towards 10 SMA (1.3207).
The pair is looking for tomorrow’s release of UK CPI data which could generate fresh direction signal.
Inflation in the UK is expected to rise to 3% in September after 2.9% in August. Release above 3% would be supportive for sterling and spark fresh upside, in extension of past five-day’s rally.
Downbeat CPI data (below 2.9%) would put pound under pressure and risk deeper pullback.
Res: 1.3311, 1.3326, 1.3341, 1.3415
Sup: 1.3253, 1.3222, 1.3207, 1.3182
