Do key levels even matter with the Sterling?
With so much uncertainty surrounding Brexit, do key technical levels still have relevance on the Cable? The short answer is yes as major news is usually priced in before any major reports are actually released (ever hear of "buy the rumor, sell the news?"). However, it is still critical to pay attention and stay up to date on any major releases; the market can turn on a dime on unexpected outcomes.
Last weeks dollar weakness is probably an indication of whats to be expected from the major US economic reports this week. The Sterling's recent resurgence is largely on the back of Brexit optimism. I think its important to emphasize this concept: There is a premium to pay for certainty and safety!
The 1.325 zone is the one to watch here. A clear rejection @ or below this zone is a good sell opportunity, with a profit target around the 1.27 zone. If there's conviction above this level, bullish sentiment should kick in and form a higher high. A price target for an upside move is more murky as there's two resistance zones (1.34 and 1.353) to over come before a big leg up.
Personally, until this pair can convincingly break above the 1.325 zone, I'm staying bearish on this pair and taking a wait and see approach.
Last weeks dollar weakness is probably an indication of whats to be expected from the major US economic reports this week. The Sterling's recent resurgence is largely on the back of Brexit optimism. I think its important to emphasize this concept: There is a premium to pay for certainty and safety!
The 1.325 zone is the one to watch here. A clear rejection @ or below this zone is a good sell opportunity, with a profit target around the 1.27 zone. If there's conviction above this level, bullish sentiment should kick in and form a higher high. A price target for an upside move is more murky as there's two resistance zones (1.34 and 1.353) to over come before a big leg up.
Personally, until this pair can convincingly break above the 1.325 zone, I'm staying bearish on this pair and taking a wait and see approach.
Commentaire:
1.3074 is the new level to watch for downside movement. Any break below this and we can target the 1.27 demand zone. To the upside, the 1.325 needs to be broken for any bullish momentum.