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Collins: Bearish on Cable ahead of NFPs
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Alan Collins from 3cAnalysis believes sideways trading in GBPUSD is coming to an end and will move to the downside. Here’s how he is trading Cable ahead of the July nonfarm payrolls.
Collins says GBPUSD has been range bound for the past four weeks with sentiment changing direction every week. In addition fluctuation has happened around the 13-day moving average, which is normally a trend defining indicator.
On Thursday, Cable saw strong up side rejection, leaving prices below both the 13 and 200-day moving average, Collins says. While the downside has stalled at the 100-day line, the net decline was so big that Collins is negative on GBPUSD.
With the NFPs out on Friday, which could move the dollar, Collins is looking for the downside ahead of the US jobs report. He says rallies should be limited around 1.5558. His downside targets are 1.5468 and 1.5427 with a stop at 1.5597.