Cable’s Big Test: Inverse Head & Shoulders Nears Breakout
01 September 2025
The British Pound to American Dollar — popularly known as cable — is shaping up for a major technical decision. Since the beginning of July, the pair has been carving out a large inverse head and shoulders pattern, highlighted within the orange rectangle on the chart. This formation is one of the most reliable bullish reversal signals, and its presence on such a widely traded pair is drawing plenty of attention.
Right now, price action is finishing the right shoulder of the formation, with eyes firmly fixed on the neckline. This neckline is a crucial horizontal resistance marked in red. A decisive daily close above this level would open the door to a proper long-term buy signal and could mark the start of a larger bullish phase for cable.
However, traders should be cautious. If the pair closes a day below the blue support — the line connecting the bottom of the head and the right shoulder — then the pattern would be invalidated. That would flip the sentiment into bearish territory, with the failed inverse head and shoulders acting as a strong sell signal. For now, everything hinges on how the pair behaves at these two key levels.