Cable drops 40 pips today as the pound is the weakest performer
I'm not seeing any key headlines to drive pound weakness today but it is perhaps a sign of exhaustion after the run higher since the break of 1.3000. The fact that we have US non-farm payrolls on the agenda is also timely for some profit-taking I reckon.
The pair has now fallen to a session low of 1.3112 as I type this and looks to be threatening a fall below yesterday's low of 1.3104. For the time being, buyers should not be too worried as the drop isn't taking out any key levels.
However, if price starts to track back under the 1.3100 handle, I think there could be cause for concern in terms of questioning the break higher seen on Wednesday.
The weekly chart offers a better perspective of things when it comes to cable:
Price is running into some key resistance levels currently as we look to wrap up the week and perhaps those levels may prove to be where sellers draw the line ahead of the UK election next week on 12 December.
