Cable hit new three-month low and eyes key support at 1.2773
Cable accelerated lower in early European trading on Thursday and hit new three-month low, driven by negative sentiment on rising pressure on PM May to step down.
Decision to hold another parliamentary vote on Brexit (likely in early June) adds to pound’s negative tone.
Wednesday’s close below former low at 1.2865 (25 Apr) generated negative signal and bears now focus key support at 1.2773 (Fibo 61.8% of 1.2397/1.3381 / 14 Feb trough).
Bearish daily techs favor further downside with violation of 1.2773 pivot expected to generate strong bearish signal for extension of bear-leg from 1.3179 (3 May lower top).
Falling and thickening weekly Ichimoku cloud maintains strong pressure, as bears look for Friday’s close below broken weekly Kijun-sen (1.2889) that would confirm bearish scenario.
Meanwhile, adjustment may precede fresh weakness as daily stochastic bottomed in deep oversold territory.
Falling 5SMA marks solid resistance at 1.2905 and guards pivotal 200SMA barrier (1.2957).
Res: 1.2851; 1.2865; 1.2905; 1.2957
Sup: 1.2820; 1.2791; 1.2773; 1.2745