The cable is back

Latest several weeks were very positive for the british pound. It is exactly the situation when the best news is the absence of news. I mean no talks and no meetings with the allergic topic by the name of Brexit. The next week has some important economical reports though: CPI and PPI on Tuesday, Retail Sales on Friday. These reports will be a real test for the sustainability of the latest cable’s bullish achievements. In case if bulls could get a support from that side, BoE would face a stronger pressure about faster tightening, leaving the regulator not much of the choice rather than to react in a proper way. Brexit mantra won’t help any more. On the other hand, politicians could turn on the agitation machine and keep fighting with reasonable fundamental price of GBP/USD in order to push it lower. Anyway, the only thing that we can guarantee about the next week is higher-than-usual volatility.

Technically, the pound breached long-term resistance and is heading to pre-Brexit levels. Our subscribers have seen a chart like this two weeks ago:

The blue plane indicates the range of 1.3720/70 as the nearest target. Guess what is the closing price of this week? 1.3725 with the highest rate at 1.3744. By the way, guess when was the last time we’ve seen such rates of the GBP/USD? -Yes, 2016-06-23, the day after Brexit vote. Is the cable back??

Below is the updated chart with the same setup:

The price did not get in the zone between the brown and blue dotted uptrend lines, but achieve the rate target. So the resistances remain in play with a high probability of a local retracement. How deep is it going to be? That’s a question for a million. The war will show us the plan. Intraday momentum plus fundamental environment will give us a clue when to pull the trigger. Do you want to join our profitable community? Feel free to contact us.

There are also interesting situations with GBP/CAD, GBP/JPY and GBP/CHF crosses, so next week promises to be very lucrative.