Cable moves to a high of 1.2669 on the day
Price managed to move above the 61.8 retracement of the swing move lower in the new year and is now heading towards a test of the cluster of the hourly moving averages. The 100-hour MA (red line) sits at 1.2677 while the 200-hour MA (blue line) sits at 1.2674 currently.
Hold below and the near-term bias remains more bearish but break above and the bias then turns more bullish.
In terms of risk events, there is some UK data to come later at 0930 GMT but the major focus will still remain on Brexit for the pound. Hence, regardless of the upside move seen so far today, the Brexit picture still isn't clear and that continues to suggest that pound rallies will be short-lived when met with disappointment form the Brexit rhetoric.
However, for cable trading today will be a bit tricky as there are plenty of other risk events that could mess with the trading picture i.e. US non-farm payrolls and Fed chair Powell's speech.
Hence, if you're looking for a straightforward fade trade on the pound, I would argue that cable isn't the right way to go at this point in time despite the fact that risk levels can easily be defined and limited by the key hourly moving averages above.
