Cable is standing at the front foot in the early European trading despite upside rejection at 1.4268 (session high).
Overall structure remains bullish and keeps target at 1.4300 in focus, after key near-term barrier at 1.4244 (27/26 Mar highs) was cracked on Friday’s spike to 1.4296.
Friday’s strong upside rejection which ended in Shooting star reversal patter, so far did not show stronger impact on bulls, but requires caution.
Stronger bearish signal could be expected on close below 1.4220 (Friday’s low) which would validate the pattern and generate stronger bearish signal.
Overbought slow stochastic on daily chart supports scenario, however, bullish setup of daily MA’s and firming momentum studies, offset negative signals for now.
Bulls need break and close above psychological 1.4300 barrier to neutralize downside risk and open way for test of key med-term barrier at 1.4244 (25 Jan post-Brexit recovery high).
Meanwhile, the pair may hold in extended consolidation, with downside remaining at risk, while bearish scenario on close below 1.4220 would open way for deeper pullback and expose supports at 1.4170 (Fibo 38.2% of 1.3965/1.4296) and 1.4141 (rising 10SMA).
Res: 1.4268; 1.4277; 1.4300; 1.4345
Sup: 1.4230; 1.4200; 1.4170; 1.4141
