Cable accelerated higher and hit new 3 ½ week high at 1.3161 in Asian session on Tuesday, boosted by reports that UK PM May was considering delaying the deadline for UK’s exit from the European Union.
Fresh rally surged through 1.3112 Fibo barrier (76.4% of 1.3217/1.2772), the last obstacle en-route to 1.3217 target (2019 high), which kept the upside limited in past few sessions.
Increasing daily momentum and MA’s in bullish setup (converged 10,20,30 SMA are on track to form multiple bull-cross with 200SMA at 1.30 zone) support scenario for final push towards 1.3217 (25 Jan high).
Bulls may run out of steam on approach to 1.3217 as daily stochastic is overbought and barrier reinforced by converging 100/55WMA’s (1.3201/1.3223), with additional pressure coming from falling and thickening weekly cloud (cloud base lays at 1.3265).
Broken Fibo barrier at 1.3112 now acts as initial support, with rising 5SMA (1.3077) expected to keep the downside protected to maintain bullish stance.
Res: 1.3161, 1.3217, 1.3265, 1.3297
Sup: 1.3112, 1.3077, 1.3047, 1.3000
