Cable extends sharp fall after eventual break of pivotal 1.20 support, pressured by growing concerns about inflation-growth puzzle which boosts fears that the economy is heading into recession and fresh hawkish comments from Fed policymakers.
Soured sentiment adds to bearish technical studies, completing negative near-term outlook, as the pair is on track for a weekly close below psychological 1.20 level and for the biggest weekly loss since the first week of September 2020.
Bears eye 2022 low at 1.1760 (July 14), violation of which would risk deeper fall and retest of pandemic low at 1.1410 (March 2020).
Oversold daily conditions give initial warning that bears may face headwinds on approach to key 1.1760 support, with limited upticks expected to remain below 1.20 level (psychological /daily cloud base) and offer better levels to re-enter bearish market.
Res: 1.1900; 1.1936; 1.2000; 1.2062
S: 1.1760; 1.1700; 1.1634; 1.1556
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