We were surprised by Cable’s ability to hold on to gains and the extent of yesterdays move given the lack of impetus. Ahead we have numbers from both the UK and the US though of immediate concern for us will be the Claimant Count Change data at 0600GMT as a strong read here and hints of wage inflation could delay BoE easing and give the currency a shot in the arm to push higher just a little bit further.
Resistance
- 1.26342 – May 03 Spike High
- 1.25928 – 50D Moving Average
- 1.25684 – Monday’s High
Support
- 1.25416 – Yesterday’s Breakout Point
- 1.25033 – Intraday High / Low
- 1.24811 – Bullish Trend Line
Yesterday’s rally managed to clearly push past the 1.25411 immediate resistance and hold on to much of its gains underscoring the bullish tone. Indicator wise we have the daily stochastic looking to push overbought though we face the 50D Moving Average at 1.25928. At the 4H scale we have been consolidating since New York trade with stochastic also poised to come off overbought levels. Given thus we prefer a straddle with shorts on a break lower of the current consolidation to test the bullish trend line. Buys on the other hand could be taken above 1.25684 the immediate objective would be a test of the 50D Moving Average.
