GBP crosses/Trade Ideas

Cable: Hanging on grimly to the 1.58 handle

As I’ve said a few times recently, cable is extremely tricky to trade at the moment. There have been a lot of flows into EUR/GBP which has been the main source of bearish pressure on the pound but in recent days, there has been talk of some very large flows in straight cable.

Interestingly enough, some of these flows were reportedly cable buyers, and it would seem that there are some eager sellers hanging around and waiting for big buy orders to emerge so that they can offload what they need. This is quite a bearish sign in my view.

Would I sell here at 1.5825? No way! I’ve been trading cable since 1986 and it often looks it’s worst just before it rallies so I’m not chasing it lower. I’ve booked 60% of profits on my EUR/GBP longs and will wait impatiently for a 150 pip dip so that I can reinstate for the next leg higher.

  1. Good evening Sean,

    In your previous comments, you prefer to buy dips for AUD/JPY, USD/JPY, EUR/JPY. It’s make sense but if we fail with the support 87.80 (USD/JPY) is it good clue to shift to “sell rallies” mode ? For instance on EUR/USD ? Thanks.

  2. Yesterday, the support has been held at 1.5800 and this morning we have UK releases on the agenda. If this support holds, it might be interesting to short EUR/GBP with SL above 0.8450 ?

  3. Hi sean.im not really bothered with any thing other than the fact that the pound is really oversold and this is a significant level.the risk reward is great(maybe a quick 100 pips to the mvag200 daily) and iv triggered small long position with a stop loss at 1.5785.
    iv got nothing to lose..id definitely not sell at these levels,like u said.sometimes i pick up these trades even if they dont make much “fundamental” sense.

  4. I have just finished to read the “Weekly Bank Research” and they have shifted to bearish from neutral for the cable. Two day ago, you were in sell rally mode for this pair. Just an observation 😉

  5. Still am Papillon, very much in sell-rally mode. If EUR/GBP goes to 88 like I think, and EUR/USD stays rangebound around 130/135, then cable will be trading near 150

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