‘Tigger’ Phil’s Full Of Bounce, Is Cable Too?
Faraday Research | Mar 14, 2018 08:44AM ET
Wise-cracking Phil Hammond delivered his Spring Statement with a more optimistic outlook on the economy noting that there is “a light at the end of the tunnel” for the UK’s finances, though Brexit remains a big uncertainty on the horizon. His upgraded forecasts were delivered as advertised though we do note that the severe downgrades to the forecasts in November were only marginally better yesterday.
Sterling reacted positively to the rosier outlook and it is the price action in cable which has caught our eye. The daily candle chart shows that a bull wedge pattern had formed over the last few weeks. This means prices had been consolidating around 1.3850 with the potential for a break higher in line with the dominant longer-term uptrend.
Yesterday’s move up looks to have pierced the top of the wedge formation. Interestingly, when we drill down into the shorter time frame hourly chart, we can see that prices have retested that support area which also corresponds to the 50% retrace level of yesterday’s burst higher.
This means that if we now hold above this zone, price action looks good for more upside in cable. Near-term targets once we get through the recent highs around 1.40 include the February high at 1.4145.
Of course, the Eeyores may have their say in which case yesterday’s break higher could be false and we then revert to range trading. Eyes on the unending US political soap opera plus next week’s EU summit will no doubt impact on direction in the near-term.
Original post
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.