No breakthrough in UK/EU talks over Northern Ireland deflates pound
Cable fell in early US trading on Wednesday, deflated by failure of UK/EU talks about post-Brexit talks with Northern Ireland.
Short-lived rally earlier today, driven by hawkish comments by BoE’s chief economist, stalled under 1.4200 and fresh weakness shifts near-term focus lower, pressuring initial support at 1.4112 (Fibo 23.6% of 1.3669/1.4249 rally) which kept the downside protected in past 2 ½ weeks.
Rising bearish momentum and south-heading RSI on daily chart warn of fresh attempts through the higher base at 1.4100 zone, break of which would trigger deeper pullback.
Near-term bias is expected to remain with bears while the action respects 1.4200 barrier (top of the range of past five days).
Thursday’s US inflation report and ECB’s policy meeting are eyed for fresh signals.
Res: 1.4166; 1.4200; 1.4233; 1.4249
Sup: 1.4112; 1.4082; 1.4052; 1.4027