Cable extends weakness below thin daily cloud, signaling continuation of steep downtrend from 1.4376 (post-Brexit recovery high) after Thursday’s action showed indecision and held within cloud. Bears pressure immediate support at 1.3868 (100SMA / Fibo 76.4% of 1.3711/1.4376 rally), break of which would open way towards key short-term support at 1.3711 (01 Mar trough). Sterling remains under strong pressure after weak data last week reduced probabilities for rate hike in May, which resulted in two weeks of heavy losses. Bearish studies add to negative outlook, which could worsen if UK GDP (due today) falls below expectations. Gross Domestic Product for Q1 is forecasted unchanged at 1.4% (y/y) and 0.3% vs 0.4% previous (q/q) but could be impacted by severe weather that hit the UK earlier this year.
Res: 1.3934, 1.3965, 1.4000, 1.4054
Sup: 1.3868, 1.3840, 1.3780, 1.3711
