GBP futures: Consolidation lies ahead

According to CME Group’s advanced figures for GBP futures on Thursday, open interest decreased by more than 1K contracts, recording the fourth consecutive drop at the same time. Volume, instead, rose significantly by more than 53k contracts, reverting the previous decrease.

Potential near term top above 1.3100

Cable has been retreating since recent fresh cycle tops near 1.3130 on Tuesday, although the down move has been accompanied by decreasing open interest (albeit not by significant levels), while volume rose sharply yesterday.

According to yesterday’s price action, we can infer that some decent contention lies around 1.2930, although investors might appear unmotivated to buy the Sterling in light of the increasing uncertainty around UK politics and Brexit. Some consolidation around 1.3000 thus seems to be the more likely scenario in the near term.