With the 61.8% Fibonacci level being respected, $GBPUSD looks ready to head back to the bottom of its down channel as London opens the new week. Watch $GBPUSD test and break 1.60 on its way to new lows at 1.5850, the 50% Fibonacci level of the summer breakout of 2012.
Furthermore, the USD moves could actually dominate flows as US events risk increases in this last week before the election and NFP Friday. Nevermind Sandy and a docket full of economic releases heading into the jobs report. In contrast, the UK has a very light calendar with only 2 PMI numbers released this week. It seems a very good week for the USD to strengthen significantly against sterling. Could this be the week of reckoning for cable?
Disclosure: Short at 1.6068
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