Extended sideways mode looks for fresh direction signals
Cable remains in extended sideways mode and moving around 200DMA (1.2023), with psychological 1.20 support still offering solid support and holding the action for the third consecutive week.
Technical studies are mixed on daily chart, as momentum remains in negative territory, while stochastic is heading north and moving averages are in neutral setup.
The action is supported by rising thick daily cloud but continues to lack momentum for eventual break higher.
Weaker than expected UK services PMI added to softer near-term tone, though more signals is required to define near-term direction.
Traders focus on today’s US ADP US private sector labor data, Friday’s release of US Dec non-farm payrolls and Eurozone inflation report, which would provide fresh signals.
Pivotal supports lay at 1.20 / 1.1950 (psychological / Fibo 38.2% of 1.1146/1.2442 rally) and break here would weaken near-term structure and risk test of daily cloud top (1.1886).
Range top (1.2087) marks initial barrier, followed by a first trigger at 1.2109 (Fibo 38.2% of 1.2446/1.1900 bear-leg) , break of which would expose upper pivot at 1.2174 (daily Kijun-sen / 50% retracement).
Res: 1.2087; 1.2109; 1.2147; 1.2174
Sup: 1.2000; 1.1950; 1.1902; 1.1886