Technical Analysis

Cable extends drop as dollar holds firm on cautious risk tones

GBP/USD sellers threaten a break of the 200-hour moving average


Cable has fallen to a low of 1.3025 on the day as price now looks to be falling below the 200-hour MA (blue line). If sellers manage a break here, the near-term bias will then turn more bearish. The dollar, yen and swissie are picking up some light bids across the board on the session as US-China trade tensions resurface after a Reuters report here suggested that both countries are far away from a compromise.

S&P 500 futures have fallen off since and is now trading near the lows as a result:

E-minis 08-05

US 10-year yields have also fallen off to 2.44% now, down by 1.6 bps, and that has helped to see USD/JPY fall from 110.15 to 110.00 currently. Meanwhile, AUD/USD has also dipped lower to 0.7006 from 0.7015-20 earlier and USD/CAD is pushing towards session highs near 1.3475 at the moment.

As for cable, as noted above, the 200-hour MA is a key support level to watch for now. If sellers regain near-term control, the 1.3000 handle will be quickly eyed in the session ahead.

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