Sterling was sharply lower in mid-European trading and reversed Monday’s rally, as report released on Monday signaled easing tensions between US and China as two sides were negotiating to improve US access to Chinese markets, which boosted dollar.
Cable fell to session low at 1.4125 after upside attempts repeatedly failed at 1.4244, where a double-top was left.
Fresh weakness broke below initial support at 1.4144 (16 Feb former high) and pressures next support at 1.4118 (Fibo 23.6% of 1.3711/1.4244). Break here would generate fresh bearish signal and risk further easing towards key supports at 1.4060/40 (rising 10SMA/Fibo 38.2% of 1.3711/1.4244 recovery leg), loss of which would signal reversal.
Daily indicators turned south and support scenario, however overall bullish structure sees current action as corrective while dips hold above 1.4060/40 pivots.
Today’s close will be in focus for fresh signals.
Res: 1.4193, 1.4218, 1.4244, 1.4277
Sup: 1.4118, 1.4060, 1.4040, 1.4000
