Cable continues its recovery this morning as the UK bank rescue plan unfolds and is adopted in various forms across the continent. Prices reached 1.7400 a short while ago. triggering a knockout option, before dipping. Extreme levels of risk aversion are easing this morning, helping reverse all the forces which built up momentum last week. GBP/JPY is firmer, up 8 yen from Friday’s 166.00 low, to illustrate this last point.
1.7513 is important resistance for cable on rebounds, the 38.2% retracement of the drop from 1.8675 after jitters emerged on the US monetizing its debt to 1.6800 on Friday.
