Supply zone located around 1.5550-1.5600 (the upper limit of the depicted bullish channel and 50% Fibonacci level) provided considerable resistance for the cable last week. It pushed the pair down to 1.5015.
Previous consolidation range above 1.5200 was broken down when we had daily closure below 1.5190. Based on this bearish range breakout, the cable hit its projection target around 1.5060 then 1.5030 (4th of April's low) where some recovery is seen so far.
The bullish recovery pattern above 1.5020 is still valid, this favors one more upswing, for further testing of 1.5190-1.5200 supply zone. However, it is important to note that yesterday's daily candlestick came bearish as a result of the increased demand for USD due to expectations of reducing the Federal Reserve monetary easing program.
Resistance levels: 1.5200, 1.5370, 1.5580, 1.5650, and 1.5850.
Support levels: 1.5030,1.5030, and 1.4975.
Yesterday the market was quite sluggish caused by the holiday in the U.S. and British banks, this renders the same view intact.
Last week, there was a bullish trial to step again above 1.5200. However, the movement was stopped at 1.5275 (within the depicted short-term bearish channel). Hence we expect 1.5200 provides another chance for sellers acting as a strong supply zone. This view is favoured especially after we have a possible ascending bottom at 1.5060 being formed to push again towards 1.5200.
Breakthrough above 1.5200 invalidates the bearish scenario in the short-term expressing a bullish breakout with targets at 1.5340 potentially.
