I’ve just had a chat with a professional trader friend of mine who’s been trading cable at major institutions for over 30 years. He feels that the cable is due for a major move and he thinks it will be up. His arguments are that if some major selling was going to emerge it would have done so by now. The weak EUR has dragged cable lower but the EUR/GBP cross has fallen also and is now below important support at .8600. Once the election is out of the way, he feels that a big rally back towards 1.57 is possible, especially if the Tories come close to an absolute majority.
I personally had been bearish especially after the previous pivot at 1.5550 held firm but his arguments were quite persuasive. If the EUR/USD becomes significantly oversold in the next 48 hours, it might be worth buying that cable dip for a potentially excellent risk-reward.
