Cable Is Holding In Extended Consolidation; Bias Remains Skewed Lower

GBPUSD

Cable is trading within narrow consolidation above one-month low at 1.2775 for the second day with mixed signals from technical studies seeing no clear direction in the near-term.The latest polls showed narrowing lead of Conservative party over Labour party that may pressure sterling further in the days ahead of election. Near-term structure is bearish and recovery attempts being so far capped by thick hourly cloud, keeping initial resistance at 1.2850 (Monday’s high) intact for now. Friday’s long bearish candle continues to weigh, with bears requiring clear break below 1.2786 (Fibo 38.2% of 1.2365/1.3047 upleg) to signal fresh extension of pullback from 1.3047 peak towards next support at 1.2706 (55SMA).

Rising and thickening daily cloud is underpinning broader rally (cloud top lies at 1.2662) and should contain extended dips. Meantime, bullish signal is developing on reversal of daily slow stochastic from oversold zone that may pause bears for extended consolidative/corrective action. Converged daily Tenkan-sen / Kijun-sen lines (1.2911) are expected to cap upticks.

Res: 1.2850; 1.2866; 1.2895; 1.2911 Sup: 1.2786; 1.2775; 1.2755; 1.2706

GBP/USD Daily Chart

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