The New Zealand dollar is the early leader on speculation the incoming central bank leader will be less dovish but cable has climbed up off the matt after falling as low as 1.5539 at the end of European trading. The 40-pip rebound comes after a 230 pip, four-day fall.
Given the sharp fall, I think it’s time to take profits on shorts and consider positioning for a small bounce. A reasonable bounce would target 1.5630 which is the convergence of the 38.2% retracement and the June 22 high.
