This pair is having its fun with traders—first hints of highs; then hints it is dropping and once everyone gets short, wham, a bounce back up. Cable is stalling. It could be that it's caught in a period until July 21 where its seasonal tendency is to go up while there is downward pressure on the pair. Eventually it will find a direction.
It's currently retesting the channel line through which it broke below. The line is at 1.5103 and cable has gotten slightly above that at 1.512. On the daily chart (not shown) the low of 1.4949 was a doji so it price should drop below there then I'd say a bigger decline was coming. If the pair climbs back into its channel and continues up, 1.5220/55 will probably see sellers coming in. This zone contains a fib confluence as well as a downtrend line. Above that is the weekly channel at 1.5329.
I'm watching this pair and may try a short if RSI falls below 70 on the hourly chart, depending on price behavior on the same.
Here's the daily chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
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