FxWirePro: Cable interim rallies in consolidation phase halt, whipsaws pattern turns to resume major bearish trend – Debit binary spreads to speculate

On intraday charts (4H), the bears appear at 1.2906 levels to plummet the rallies and prices to slide below 7 & 21-SMA levels.

The current price behavior goes in whipsaws at 7-SMAs, consequently, contemplating previous rallies we could foresee prices to slide below DMAs with confirmation from momentum indicators.

The price dips may extend upto next strong support of 1.2610 or even upto 1.2580 levels on healthy bearish momentum as we could notice bearish convergence on leading oscillators. While MACD’s bearish convergence signals downswings to prolong further upto this level to find strong supports.

Well on a broader perspective, both leading & lagging indicators confirm the major bearish trend, current well below EMAs heading for the retest of multi-year lows.

The downswings have constantly been sliding testing resistance at EMAs, with confirmation from both trend and momentum indicators (refer monthly charts).

Historically, RSI’s downward convergence below 42 levels on monthly terms and stochastic curves are still below oversold territory signal the strength of the bearish trend.

MACD is not deviating from this bearish stance, signals the downtrend to prolong further with its bearish crossover.

Trade tips:

As we are still in major bearish trend, contemplating current lingering bearish indications at this juncture, on both hedging and speculative grounds we recommend shorting mid-month month futures as the underlying spot FX likely to target towards 1.2366 levels.

Writers in a futures contract are expected to maintain margins in order to open and maintain a short futures position.

These margin requirements are determined by the exchanges and would usually be ranging from 2 to 10% of the full value of the futures contract.