Cable technical analysis
The pound tumbled today after core inflation rose just 1.2% y/y compared to 1.3% expected. The overall CPI fell 0.8% m/m in a sign that the Bank of England won't be fighting price pressures any time soon.
The drop caused a sharp fall to 1.4277 from as high as 1.4516 earlier. The selling accelerated as yesterday's low of 1.4413 broke.
Technically, the more important break is the wedge that's been forming since early February. The Feb 2, Feb 8 and Feb 11 lows gave way in succession in a sign of how aggressive the selling was.
The measured target of the break would take the pair through the January lows. That's tough to imagine but if the FOMC Minutes tomorrow kick off of a good run of economic data and hawkish Fed talk, it's certainly possible.
