Cable realized steady gains again on Monday on the back of stronger than expected manufacturing data in the United Kingdom early in the session before running into resistance around 1.55, as it has done on numerous occasions in October.
the last stage of the rally came at a time when the stochastic made lower highs suggesting momentum in the last rally fades. This divergence in what was recently a key resistance level is not in itself a bearish signal but it does make me less optimistic in the short term.
With the pair trading at earlier summits with divergence, the only thing that is missing is a reversal pattern that could be considered as confirmation that the consolidation, correcting the inversion occurred.
We can see that now on the 4 hour chart, with an evening star formation may appear. If the current candle closes and confirms that, it suggests a further decline could follow.
Initial support came around 1.54, which held the first request. A break below here would support the idea that more losses are coming. Below, additional support may be found around 1.5380 - front support and resistance - 1.5350 .. And
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