British Pound Breaks Support Line

[B]Commentary[/B]: We wrote yesterday that “the idea that Cable is tracing out a larger 4th wave remains possible, which means that this down leg could be just the first leg of a larger correction. The line in the sand for the larger bullish picture is 2.0203. However, given the EXTREME sentiment (speculative positioning extremely long), Cable could very well continue to drop fast.”

Althought price has yet to breach 2.0203, the drop below the line drawn off of the 6/14 and 7/6 lows instills confidence in the near term bearish strucutre. 2.0203 is the next support level (this is also the 161.8% extension of 2.0654-2.0424/2.0561. The intraday reaction high at 2.0391 should offer strong resistance. [B]Strategy[/B]: Move to flat, get bearish near 2.0391, target TBD