Cable collapses despite upbeat UK labor data
Cable fell to 6 ½ month low on Tuesday after UK labor data showed significant rise in new jobs, fall in jobless claims and increase in average earnings, but were soured by unemployment increase.
The sentiment remains weak on negative impact on global economy from corona virus outbreak, while dollar regained traction and rose, increasing pressure on sterling.
Fresh weakness broke through supports at 1.2200 zone (8/11 Oct higher base) opening way towards critical 1.20 support zone which contained broader fall’s acceleration after Brexit vote in 2016 and also contained repeated attack in Aug/Sep 2019.
Attempts to form a base here are fading and risk of break lower is rising.
Technical studies are deeply oversold that may keep bears on hold for some time, but outlook remains negative and upticks will be seen as positioning ahead of fresh downside.
Res: 1.2202; 1.2275; 1.2325; 1.2425
Sup: 1.2050; 1.2000; 1.1958; 1.1930