Cable is holding within narrow range above Thursday’s low at 1.3112, which was posted on sharp fall after BoE. Pound was down 0.67% on Thursday (the biggest one-day fall since 07 July) after the bank of England left interest rates unchanged and cut its economic growth for this and next year.
Sterling showed strong hesitation at the levels above 1.3200, where upticks were repeatedly rejected (series of fresh highs between 1.3244 and 1.3268), ahead of pullback.
Another negative signal was generated by formation of bearish Outside Day reversal pattern on Thursday, which may boost near-term bears for deeper correction.
Scenario requires break below rising 10SMA (currently at 1.3128) which so far holds and break below yesterday’s low at 1.3112, to resume lower.
South-heading daily indicators are supporting the notion, however, overall bullish picture keeps bias at the upside.
Bounce above 1.3200 barrier is needed to neutralize downside threats and shift focus higher. US jobs data today are expected to give more clues about pair’s near-term direction.
Res: 1.3171, 1.3190, 1.3208, 1.3225
Sup: 1.3128, 1.3112, 1.3050, 1.3004
