Cable rises towards 1.30 barrier early European trading on Tuesday after bears faced strong headwinds from key 200SMA support (1.2967, reinforced by converging 100SMA).
Markets are regaining pace after holidays and UK parliament is back to business, with expectations that PM May will be forced to step down by the end of June, following her multiple failures to break Brexit deadlock.
Overall picture is negatively aligned, however, daily studies are still mixed (bearish momentum continues strengthen, 10/20/30SMA’s are in negative setup, while deeply oversold stochastic is turning north) and risk of further weakness will remain limited while 200SMA holds.
Upticks are expected to offer better selling opportunities (while staying capped by daily cloud base/10SMA at 1.3024/34) for renewed attack at 200SMA. Sustained break below 200SMA and Mar low (1.2960) would open supports at 1.2916 (Fibo 76.4% of 1.2772/1.3381) and 1.2889 (50% of larger 1.2397/1.3381 ascend).
Conversely, close above 10SMA would ease pressure and expose a cluster of daily MA barriers (20/55/30).
Res: 1.3008, 1.3024, 1.3034, 1.3059
Sup: 1.2975, 1.2966, 1.2960, 1.2916