Daily view:
The cable invalidated the reversal Head and Shoulders pattern maintaining quite strong bullish momentum to the upside.
Daily closure above 1.5719 (the highest level in August) enhanced further bullish pressure to be applied, so that the bulls could step above 1.5760 (the highest level in June).
The pair expressed a bearish Harami daily candlestick off 1.6150, which was followed by daily closure below 1.6035 which took place on Friday. However, the cable bounced from recent lows resuming the upside momentum, having climbed back above 1.6200 as the USD weakens during the previous trading days.
Previous bullish swing targeted 100% Fibonacci Expansion level. However, the current bullish swing was strong enough to bypass this level when the pair stepped above 1.6035 recording a daily high at 1.6262 which is 70 pips higher than 127.2% Fibonacci Expansion Level. However, most of the daily gains was being lost affected by ISM manufacturing PMI resulting in an inverted hammer daily candlestick yesterday.
Price fixation above 1.6205 enables the bulls to reach 1.6285 very quickly (141.4% Fibo Expansion) where intraday resistance should be applied.
