26 Jan Cable Levels To Watch For Trade-able Retrace
The rally in Cable over the last couple of Weeks has shown considerable strength and though I have mixed opinions from a fundamental perspective, it is more than possible we’ll see trade-able pull back from current levels.
Judging how deep that pull back will be is a little more tricky, so here are a few charts to help you find your own conclusion:
Today’s high topped out at a projected channel top right down to the tick:
The 4 hourly chart shows we have entered a previous congestion area that is unlikely to be sliced through first time round:
Moving out to the Weekly chart, upside risk is likely to be in the form of 2 or more Weekly candle closes above the 100 MA which is currently resisting this Week’s candle. Furthermore for those who remain bearish Cable, the upwards sloping trend line from the 2009 lows converging with the 61.8% fib retrace from the 2010 low and 2011 high could become a trade-able possibility were the Macro down trend to continue:
I remain flat on Cable for the time being awaiting further confirmation of a topping process with a view to entering short with an open target. I think it is worth noting that 79% of retail traders are currently positioned short. This is a contrarian indicator and often indicates further strength before a significant pull back.