Cable trade idea: Sell into technical resistance
The EUR/USD rally on Friday was sort of understandable in that the market was short and engaged in short-covering ahead of a significant risk event. The fact that cable rallied strongly alongside is less logical and the technical picture does seem to be offering up some potentially good risk-reward trade opportunities.
The recent down-move from 1.6310 is approaching it’s 50% retracement level at 1.6060 which is also roughly where the 55-day MA sits. The bearish trendline is also sitting just above there near 1.6090.
I’ve been running a small short position here in recent weeks and I am looking to add between 1.6060/90. I will start reducing again above 1.6130ish.