GBP/USD is the big mover today but it's a weak bounce

Author: Adam Button | Category: News

Cable up +65 pips on the day

The pound is the top performer today while the US dollar lags as it retraces the big non-farm payrolls move.

What stands out isn't that cable is the big mover today but that the bounce has been so shallow. Cable fell 450 pips last week and the bounce (at least so far) is only 65 pips. It's not even close to the 38.2% retracement.

Overall, today screams of a dead-cat bounce day.

Unless there is some dire US economic news, the Fed is going to hike and that will be a constant tailwind for the dollar.

The question is: How big of a bounce do you want to wait for before selling?

Normally, you want to stay as disciplined as possible but the US dollar is looking awfully juicy and I would nibble on it here in cable (and elsewhere).

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