Cable probes again through cracked 200SMA (1.3537) in early European session on Monday, after overnight’s recovery attempts were short-lived.
Despite spike below 1.35 on Friday, the pair failed to clearly break below 200SMA and generate bearish signal (Friday’s close was at 200SMA at 1.3535) and repeated failure at 200SMA today could increase risk of bounce.
Oversold daily RSI / slow stochastic and momentum turning higher, support scenario, which also needs close above broken Fibo support at 1.3550 (61.8% of 1.3038/1.4376) to generate further positive signal.
Recovery action could extend towards strong barrier at 1.3718 (falling 10SMA).
Conversely, close below 200SMA would risk retest of Friday’s spike low at 1.3486 and extension towards next pivotal support at 1.3442 (Fibo 38.2% of entire post-Brexit 1.1930/1.4376 recovery phase).
Res: 1.3564, 1.3585, 1.3629, 1.3665
Sup: 1.3528, 1.3486, 1.3442, 1.3400
