Cable holds in tight consolidation around 1.40 handle on Friday after previous day’s strong fall which dented key 1.40 support zone but failed to close below.
Sideways mode today could be see as consolidation ahead of fresh downside, as Thursday’s bearish outside day is negative signal but requires close below day’s low at 1.3965 for verification.
Negative scenario could be reinforced by twist of daily cloud next week, which usually attracts.
On the other side, mixed MA’s on daily chart lack stronger signal but momentum studies remain weak.
Sentiment remains positive on persisting optimism regarding rate hikes and Brexit talks but catalyst is needed to define near-term direction.
Initial pivots lay at 1.4039 (20SMA) and 1.3975 (30SMA) clear break of which would generate firmer direction signal.
Bullish scenario requires extension and close above 10SMA (1.4068) for confirmation, while bearish acceleration through 1.3975/65 pivots would open pivotal support at 1.3915 (Fibo 61.8% of 1.3711/1.4244 rally).
Release of US jobs data is expected to provide further direction signals.
Res: 1.4039, 1.4068, 1.4099, 1.4121
Sup: 1.3975, 1.3965, 1.3915, 1.3889
