Cable loses traction after weak UK jobless data and dips below 1.2500 mark on Tuesday morning.
Fresh weakness adds to signals that brief recovery is likely over, after Monday’s strong upside rejection which left daily candle with long upper shadow.
Overall picture is firmly bearish on daily chart, though headwinds on approach to pivotal 200DMA support (1.2424) may keep the action in extended consolidation.
Close below cracked Fibo support at 1.2472 (50% retracement of 1.8026/1.3141 upleg) is needed to generate initial bearish signal, which will look for confirmation on sustained break below 200DMA to signal continuation of the downtrend from 1.3141 (2023 high posted on July 14) and unmask next strong supports at 1.2314/07 (Fibo 61.8% / May 25 higher low).
Falling 10DMA (1.2560) offers initial resistance, guarding upper pivots at 1.2630 zone (20DMA / broken Fibo 38.2%).
Sideways mode to remain while the action stays between 10 and 200DMA’s.
Traders shift focus on BOE’s policy meeting next week, with growing bets that the MPC would deliver another rate hike.
Res: 1.2547; 1.2560; 1.2630; 1.2653.
Sup: 1.2445; 1.2424; 1.2368; 1.2314.
