Small bounce seems possible for cable

Since the Federal Reserve (‘the Fed’) still seems likely to lag other major central banks in cutting rates, the dollar has mostly strengthened in the last few days. Overall economic conditions in the USA are also significantly better than in the UK; so far, there’s no clear slowdown in either American GDP or the job market.

The 200 SMA around $1.262 might be an important dynamic support, but below this there’s also $1.26 exactly which could have become a support after having resisted the price in May. It’s probably unwise to try to find a signal from volume due to the recent American holiday, but another clear leg down from here is questionable due to oversold from the slow stochastic.

$1.27 is a possible resistance, but in the absence of any clear new driver it’d be possible to see the price setting into a range in the value area between the 50 and 200 SMAs. The next major release to affect cable is American final GDP for the first quarter on Thursday 27 June.

This is my personal opinion which does not represent the view of Exness. This is not a recommendation to trade.