The technical picture in cable is looking rather shaky
The pound is not finding much reprieve to start the new week as earlier gains just above the 1.2900 level have faded as we begin European trading.
Cable is continuing to push new lows for the year as price now threatens a firm break well below the 100-day MA (red line) @ 1.2903. A break of the technical level will see sellers exert more control in the pair with little support seen towards 1.2800 next potentially.
Brexit headlines will be a key focus once again in the coming weeks as the UK and EU will begin their near eleven-month negotiating process on a future trade relationship.
There have already been plenty of complications and that has given sellers added ammunition - alongside a technical push - to drive the pound lower over the past week.
In terms of economic releases, we will have UK Q4 GDP data tomorrow but that is largely expected to reflect flat economic conditions as it pertains largely to pre-election sentiment; when Brexit was still a giant mess, not that it isn't now though.
As such, the challenge for buyers this week is to try and stave off a move below the 100-day MA while for sellers, it is all about chasing a further break in the technical picture towards 1.2800 next and then aiming the 200-day MA (blue line).
