Rise to 1.2580. Fall to 100 day and 100 hour MA area
The GBPUSD rose yesterday on the back of positive comments from EU Commissioner Juncker on they Brexit solution. The price raced up to 1.2454 before retracing back toward the earlier week highs at 1.2525 and 1.2511. The low in the early Asian session reached between those two levels at 1.2517 and started a run higher.
After peaking at 1.2580 level (more on that target lbelow), the price started to run back to the downside. Some less positive comments about Brexit (see post here), was a catalyst for the reversal. The earlier week highs were broken, and more selling took the price back below the 100 day MA at 1.24854but stalled at the 100 hour MA at 1.24735.. There has been some stall at the area. A break below will be more bearish today.
Looking at the daily chart below, the pair stalled at the 1.2580 area. That was at the next target at the mid July swing highs (see post from yesterday). Sellers leaned against the area from a technical perspective. The price action started its run back to the downside (4 straight hourly bars to the downside).
The move lower took the price back below the 100 day MA. The dip back below the 100 day MA is a disappointment. The last 4 trading days has seen the price trade above and below that moving average. Yesterday’s break and rise to the next upside target, seemed to be «the one» that would kickstart more upside momentum for good. However, the return back to the MA level will now have traders on pins and needles. Will the break fail again?
A move back below the 100 day moving average at 1.24854 and 100 hour moving average of 1.24735 is likely to sour the mood for buyers from a technical perspective.