Cable a little higher to start the day, sticks with the bounce from yesterday

Technical Analysis

Author: Justin Low | gbpusd

GBP/USD is up slightly to 1.3730 to start European trading

GBP/USD D1 22-07
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Things were looking ugly for cable at the start of the week but they are turning around now, after support near the 4 February low @ 1.3566 held. The low yesterday touched 1.3572 but it was enough for buyers to push back and wrestle back some momentum.

Of note, the shove higher now takes cable price action back above its 200-day moving average (blue line) @ 1.3699 and also back above the 1.3700 level.

Looking at the near-term chart:

GBP/USD H1 22-07
Buyers have also managed to seize back some near-term control on a push above the 100-hour moving average (red line) @ 1.3698 currently, thus seeing price bias more neutral.

For the time being, that and the 1.3700 level will be an important benchmark in trying to sustain any further upside momentum in the bounce from yesterday.

That said, topside is also rather limited with the 50.0 retracement level @ 1.3741 the first line of defense before the 200-hour moving average (blue line) comes in @ 1.3775.

The overall market mood is still a key factor dictating trading sentiment this week so we'll see how that plays out ahead of the weekend. But for now, at least the technical bleeding has stopped for cable and that is some comfort for pound buyers.

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