Cable fought and clawed to get above yesterday’s spike high of 1.6070 but after finally clearing the level, there was hardly any follow though. The high was 1.6086 and the pair has now slipped back to 1.6066.
cable 5 minute chart
The ability to make a higher high after holding the 1.5875 zone yesterday is a positive sign for the pound but ultimately, it’s worries about the eurozone that are driving risk aversion.
As long as that looms as a headwind for the UK, I don’t see anything more than a token rate hike from the BOE and that will snuff out any rallies — even when technical levels break like they did today.
The only real place to buy sterling in the longer-term is against the euro.
