It’s important to remember where cable has come from, not just where it might be headed. It’s not terribly long ago that we were trading near 1.50 and the whole world was bearish. Now we are trading just below 1.70 and the world is bullish! Looking at the crosses, the GBP has made massive moves higher against the JPY, AUD, CAD etc over the last few months and looks like we could easily see a modest retracement of some of these gains.
As you know, I’m a GBP bull and have done well on this up-move. But, there’s a time and a price for entering a market and neither seems right at the moment for the Sterling bulls.