Sterling is standing at the front foot in early Monday’s trading and probing again through very strong 1.2800 resistance zone (daily cloud top / daily Tenkan sen and falling 10SMA in attempt to cross below rising 55SMA).
Several attempts at 1.2800 barrier failed last week, keeping near-term risk skewed lower while the price stays below. Negatively aligned daily indicators support the notion, however, limited downside is seen while 1.2700 pivot is intact. Break here is needed to generate stronger bearish signal.
Conversely, sustained break above 1.2800 would neutralize downside risk and signal further retracement of 1.2977/1.2635 downleg.
Falling 20SMA / Fibo 61.8% of 1.2977/1.2635 mark next strong barrier at 1.2848.
Res: 1.2800, 1.2817, 1.2848, 1.2896
Sup: 1.2750, 1.2722, 1.2704, 1.2690