Cable erased Monday’s recovery and probed below last week’s fresh multi-week low at 1.2133, on fresh bearish acceleration. Sterling was dragged sharply lower in early Tuesday, on reaction to decision of both houses of British parliament to back Brexit bill and open way for formal start of UK/EU official divorce process. Rising uncertainty helped bears to regain strength, with the pair also being pressured by divergence in UK/US interest rates. After Monday’s recovery was capped by falling thick 4-hr Ichimoku cloud, fresh weakness hit new 7-week lows, focus is returning towards yearly low at 1.1986 (also the lowest traded level since 1985. Final daily close below 1.2155 (Fibo 76.4% of 1.1986/1.2704 rally) after four attempts failed, is needed to confirm bearish continuation. Minor supports at 1.2105 and 1.2035 lay en-route to psychological 1.2000 support at 16 Jan low at 1.1986. Falling daily Tenkan-sen that capped today’s action, marks strong resistance at 1.2214, followed by base of 4-hr cloud (currently spanned between 1.2231 and 1.2353.
Res: 1.2133, 1.2180, 1.2207, 1.2249
Sup: 1.2105, 1.2050, 1.2035, 1.2000
