My dear friends, I had to re-write this whole analysis again after the UK data came out, since the Cable has dropped sharply, reaching a new 5-year low at 1.4658. This was not a surprise, since the price has been stopping recently at retracement resistance levels then diving again.
After this new low, 1.4779 has turned into a key resistance level. However, it is obvious that we are a bit far from that level, and that we need closer resistance levels to help us estimate the chances of a recovery. First resistance is at 1.4701, followed by 1.4714, 1.4727, 1.4779 & 1.4797. These levels can give us clues on whether a recovery from today's 5-year low is probable or not. As we approach each of them, we need to watch the price for signs that it will break above them or top very close to them & then dive again. The most important of these levels in my opinion is definitely 1.4779, because it combines a Fibonacci level with the falling trend line from March 11th daily high. A break above this level would be a huge boost for the bulls, while to continue trading below this level confirms the continuation of the downtrend. The first target for breaking 1.4779 is 1.4797, which is too close to be considered a target for a break of such importance, but more realistic targets come in at 1.4853, 1.4893, 1.4953 & 1.5000.
On the support side, today’s 5-year low at 1.4658 comes first, ahead of 1.4611, 1.4569 & 1.4514. These levels are all weekly extremes (highs or lows) which have been seen years ago, and they do not hold more technical significance than that. Looking for technically important levels on the weekly chart has showed that we have 2 potential targets for this weakness, and they are 1.4346 & 1.3809 which, as explained in previous reports, have much more technical value than the levels preceding them
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