Cable touches session low of 1.3750 on the day
The dollar may be gaining, but sterling sentiment continues to deteriorate. If it's not bad data over the last two weeks, then it's politics. The latest being that home secretary and interior minister Amber Rudd resigning. She was a key ally to UK PM May and her resignations marks the fourth Cabinet member to resign in the past six months.
As for levels to look out for now in GBP/USD, first is Friday's low of 1.3747. A move below will provide sellers with added conviction as they look towards a test of the 1 March low @ 1.3712. Breaking which opens up a further move to the downside in what can be viewed as a slippery slope for the pair.
Below the March low there is the 3 January high @ 1.3613 for minor support but after that it's another big drop towards the 200-day MA (blue line) @ 1.3530. If UK data this week fails to offer any kind of solace in terms of a rebound - especially services PMI - sterling looks set for another rough week once again.
And if seasonal patterns are to go by, May isn't the best of months for cable longs (last eight Mays have seen cable post losses). But then again, you can argue that April was supposed to be the best month for cable longs and it didn't quite turn out that way, did it?
