The close yesterday also fell shy of taking out the 100-day moving average (red line) and we're seeing a further rejection of that as cable slips back below 1.3800 to a low of 1.3770.
One can point to the slight drop in UK annual inflation as a trigger but in my view, it doesn't change much ahead of the BOE policy meeting next month with core inflation still keeping well above the 2% threshold in September.
But the drop in cable also comes as the dollar trims losses across the board with AUD/USD backing away from 0.7500 to 0.7480 and EUR/USD down from 1.1650 to 1.1630.
Going back to cable, buyers have work to do in trying to breach the 100-day moving average @ 1.3800 and then the 200-day moving average (blue line) @ 1.3844.
As mentioned here yesterday, those are key levels which buyers could find some appetite to contest but a break above that and a run towards 1.4000 may be one step too far considering the fundamental backdrop at the moment.
As such, keep an eye on any turn in near-term sentiment with the 100-hour moving average resting at 1.3742. A break below that will see sellers turn the near-term bias to being more neutral and is a first step for any track back lower in cable.