Cable stands at the front foot at the beginning of the week and broke above Fibo barrier at 1.3362 (38.2% of 1.3617/1.3204 bear-leg) after Friday’s trading closed above 10SMA (1.3332) and generated bullish signal.
Repeated close above 10SMA, which now acts as initial support, is needed to signal broader downtrend is pausing and holding in consolidation mode.
The pair holds in green for the second straight day and gaining momentum for attack at next barrier at 1.3422 (falling 20SMA) break of which would signal correction under way and sideline broader bears.
UK Construction PMI data are due today and eyed for fresh signals (May f/c 52.0 vs Apr 52.5), with stronger that expected release to add to bullish near-term outlook, which is expected to remain in play while broken 10SMA holds.
Bearish scenario requires return and close below 10SMA to signal an end of recovery and turn focus lower.
Res: 1.3410, 1.3422, 1.3460, 1.3520
Sup: 1.3362, 1.3332, 1.3310, 1.3253
