FX Daily Read | Monday 18 May 2026
Cable Leads the Majors as Dollar Bears Take Charge
GBP/USD | Close 1.3436 | +0.33%
Session Summary
Sterling posted the strongest gain across the G10 majors on Monday, closing at 1.3436 after trading a wide range from 1.3304 up to 1.3450. The move was driven almost entirely by broad dollar weakness rather than any fresh UK catalyst, with the DXY sliding to its lowest levels of the session late in the New York afternoon. Cable held above the 1.3400 handle for the bulk of the US session, a level that has attracted consistent institutional interest in recent weeks. Volume was solid throughout the London open and picked up again through the New York overlap.
Daily Read
The broader framework has been bullish on sterling for several weeks, and today’s price action confirmed that thesis remains intact. Institutional positioning has been net long the pound in size, and that build has not reversed despite cable trading near multi-month highs. The session’s structure showed buyers defending every intraday dip, with no sustained selling pressure materialising even when the US equity session opened with some volatility. The overall market regime sits in risk-on territory, which historically supports higher-yielding currencies like sterling over the dollar. The only caveat is that cable has now moved a significant distance from its base, which compresses the asymmetry on fresh long entries at current levels.
Key Levels
| Level | Price | Role |
|---|---|---|
| Primary Support | 1.3350 | Key intraday floor, prior breakout area |
| Secondary Support | 1.3300 | Session low, structural demand zone |
| Resistance | 1.3450 | Session high, near-term supply |
| Extended Target | 1.3520 | Next major resistance if 1.3450 breaks |
| Long Entry Zone | 1.3360 – 1.3380 | Pullback to former breakout area |
| Stop | Below 1.3310 | Below structural demand; R:R approximately 3:1 to 1.3480 |
Tuesday’s Setup
Bias: Bullish with caution at highs
The primary scenario is a brief consolidation or shallow pullback toward 1.3370 – 1.3390 during the Asia and early London sessions, followed by a resumption of the uptrend if dollar weakness continues. The framework remains long-biased. Watch for any UK-specific news or a shift in risk appetite that could accelerate the move toward 1.3500.
Bear scenario: A break and close below 1.3350 would signal that the breakout has failed and opens a retest of 1.3300. This would require a significant reversal in dollar sentiment or a negative UK catalyst.
Experience Guidance
New to trading: Do not chase cable at 1.3436 after a 130-pip day. Wait for the market to come back to you.
Developing: A pullback to 1.3360 – 1.3380 with a clear rejection candle is the entry you want; patience pays more than participation at highs.
Experienced: Scale into any intraday dip during London, keep your stop below 1.3310, and let the trend carry you toward 1.3480 before locking in partial profit.
This is market analysis for educational purposes only and does not constitute financial advice. Trading forex carries significant risk of loss. Past performance is not indicative of future results.