Cable has been acting a lot more like a commodity currency pair these days and today is just exactly that. It is now trading back to 1.3400 for the first time since 23 November, as the dollar stays more tepid on the day.
The post-BOE gain last week faltered and the pair went down to retest support around 1.3200. Buyers held and have looked rather poised in trading this week, bringing the momentum all the way to 1.3400.
There is some minor resistance up ahead from the 38.2 retracement level @ 1.3418 and the broken support region in September around 1.3412-15. But beyond that, cable buyers may look towards 1.3500 next as they did on 18-19 November.
It’s tough to square up the moves during the year-end period but risk currencies are certainly performing well this week – today no exception. AUD/USD is up 0.4% to 0.7240 and NZD/USD also up 0.5% to 0.6837 on the day.
For one, the market seems eager to look past omicron risks but while there is scope for optimism, there’s also room for caution as we’ve seen from the headlines today.