Cable stays at the back foot on Wednesday and consolidating within narrow range at 1.3040 zone, after Tuesday’s sharp fall on weak UK CPI data found footstep at 1.3000 zone.
Near-term action is so far holding above hourly cloud base (1.3026) which marks key support along with psychological 1.3000 level.
While cloud base is holding, the price is expected to range within hourly cloud (1.3026/1.3074), with lift above cloud to signal an end of corrective phase and shift focus higher.
Eventual close above 1.3109 (Fibo 38.2% of 1.5016/1.1930 descend) is needed to signal bullish continuation. Otherwise, increased downside risk could be expected on sustained break below hourly cloud and 1.3000 handle. The notion is supported by reversal of slow stochastic from o/b territory on daily chart.
Close below 1.3010 (Fibo 38.2% of 1.2824/1.3125 upleg) is needed to generate stronger bearish signal for deeper pullback from fresh high at 1.3125. With no data from UK today, technicals are expected to be the main driver of GBPUSD pair.
Res: 1.3048, 1.3076, 1.3109, 1.3125
Sup: 1.3023, 1.3000, 1.2968, 1.2939
