The recent run high in Cable has see a number of traders stopped out of short positions post the UK election. The level that will be closely watch now is the 1.5550 high and 38.2 Fib that coincide at this level.
There are likely a large number of stops sitting just above the 1.5550 high and if the bears fail to hold the market below this level, the current short covering is likely to pick up momentum in the short term with little in the way until the 50 Fib at 1.58780.
Intraday players will be closely eying the 1:1 (Purple) and 38.2 Fib that coincide at 1.53900/85, if this support level can attract solid buying interest a break of the 1.5550 high will become a real possibility in the coming days.
* A 1:1 refers to a current correction being equal in length to a prior correction