Sterling Technical Analysis

Tuesday, March 12, 2013, Marketing Communication Cable, Weekly Since 2009 cable has been in a tightening formation, black lines, however the price action has broken lower in recent months. On breaks of trend lines retracement levels can often prove useful. The retracement lines calculated from the highs/lows in 2009 have proved to be of interest in recent years, particularly the 50% level through 2012, green lines. The price action has now moved down to the lower end of the ‘natural’ retracement channel. RSI over the past 3 years had held above the 40 level, green line on RSI chart, in bull trends the RSI tends to find support from the 40 area, not the more standard 30 that is seen in trading ranges. However on the recent breakout this 40 support has been breached. The price currently is trading at 1.4867 so near term buying may materialise off this expected 61.8% retracement support. The price action has also traded within a broad bearish trading range for the past 18 months, red lines. In summary then traders may start to get interested in buying back into sterling around current levels, using tight stops just under the 61.8% support as offering strong risk/reward. This strong risk/reward is required as this would be buying into the current bearish trend. The more cautious could be seen waiting for any bear market rally up towards the 38.2% area at 1.5691 expecting a further opportunity to sell the bear market range. Moves under the 61.8% level at 1.4855 would open targets back down to the 2009 lows at 1.3503. Contact Us For Spread Bet Sales:- 0044 (0) 207 894 8800 For CFD Sales/Traders:- 0044 (0) 207 894 8883 Email:- Sales@cantorcapital.com Images Depending on your email settings the images contained in this mail may not be downloaded correctly on the first viewing. 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