Cable remains in red for the second consecutive day and extends pullback from new one-year high (1.3044).
Weaker than expected UK retail sales increase pressure on sterling and add to bets for BoE rate cut in August (currently at 44%).
Fresh bears broke below the floor of recent consolidation (around Fibo 23.6% of 1.2615/1.3044 upleg), generating initial bearish signal, with extension below cracked rising 10DMA (1.2914) to validate the signal and close below 1.2879 (Fibo 38.2%) to generate initial reversal signal.
Also, formation of bull-trap above 1.30 barrier on weekly chart, may add to downside risk.
On the other hand, daily studies are still predominantly bullish (MA’s in bullish setup / strong positive momentum), suggesting that current pullback could be seen as correction of larger uptrend, if dips find firm ground above 1.2830 zone.
Res: 1.2942; 1.3000; 1.3044; 1.3100.
Sup: 1.2879; 1.2860; 1.2828; 1.2777.
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