Cable moves to session lows after DUP setback but buyers lean close to key near-term trendline support
Price moved to a low of 1.2750 earlier, just short of testing key near-term support around 1.2744 from the trendline since the end of last week.
As it stands, buyers are still keeping some momentum but just be mindful that negative developments in the Brexit rhetoric can easily see things fall apart rapidly.
Other key near-term levels to watch out for will be the 1.2700 handle as well as the 100-hour MA (red line) @ 1.2680. Looking at the bigger picture:
It’s a bit of a similar story to yesterday as the pound suffered an early setback only to recover late on to move above 1.2800. The key level on the daily chart is for buyers to hold above the 200-day MA (blue line) @ 1.2714.
Stay above that and the bias in cable continues to be more bullish. Move below, and sellers will regain further conviction to drive price lower – particularly if the near-term levels above give way as well.
Looking ahead, it’s all about headline risks now for the pound. Boris Johnson is headed to Brussels to try and convince European leaders he has the “right deal” and he will have 48 hours to do so while trying to sort out the mess back in Westminster.