Finally, cable broke to the downside as expected and reached lows of 1.6024 just in front of our 1.6019 support. Short term, it's a little oversold, so we should see some correction early in the session. 1.6060/70 offers resistance this morning, and if we can break above here then we look for further short term strength possibly back to 1.6090/1.6135.
Any retracement will act as a good re-entry point for shorts. Medium term, charts still point lower so selling rallies is the way forward until the strategy changes. After a correction the market will trade lower, to 1.5994 then 1.5940 as short term objectives. A little bit further out and 1.5845 is our target.
Only above 1.6135 would the market look a little stronger, and then we could see 1.6190 before we fail. Chart patterns remain negative and it is unlikely we can go back and re-test recent highs.
GBP/USD Technicals" title="GBP/USD Technicals" height="601" width="978">