Profit-taking in GBP/USD has taken the pair modestly below support at the 1.6475. Trailing stops are going off as we write. Agiants the present background, cable is sort of a turbo-charged version of the reflation trade, as is AUD/USD. When the “risk on” phase is underway, they soar higher and when the “risk off” phases hits, they are harder hit.
US equity markets have given back all their gains, oil is now lower on the day and the dollar is dusting itself off after a shaky start to the session.
1.6440 is the 38.2% retracement of the 1.6264/1.6550 rally and next support as the pound dips. 1.6407 is the 50% retracement of the same dip.