Cable cracked 1.40, but consolidation is expected before next upleg

Early in the day Cable broke the 1.40 handle and even succeeded to mark daily high at 1.4026. A pullback followed but currently the price is not far from the psychological level at 1.40.

On the four hour time frame the price continues to develop above its bullish SMAs and today’s lowest level found support at the 20-day SMA. Indicators on the same chart are yet located within positive territory, but are losing upward strength. Today’s rally is impressive as GBP/USD reached June 23 in 2016, the time of Brexit decision, but more important for the continuation of the bullish trend is a close above 1.40. I think that the bulls will take a breath before tackling higher challenges, so in the short term the Cable will be seen in consolidation mode.