Cable does something it hasn't done in almost two years

Golden cross in GBP/USD

Technical analysts are getting excited about the potential for cable gains. The pound is flattish today but the 100-day moving average crossed over the 200-dma for the first time since October 2013.

GBPUSD technical analysis

A golden cross sometimes takes time to play out. The Oct 2013 crossover was followed by two months of flat trading and then a 1200 pip rally.

We may see continued sideways moves in GBP/USD as we await clarity on when the Fed and BOE will raise rates.

The pair has been locked in a small, narrowing range for the past four months and it will be better to go-with a break rather than betting exclusively on gains. But if it does break to the upside, a quick test of 1.6000 is in the cards.