GBPUSD playing the range
The GBPUSD found the support at the 100 hour MA and 38.2% retracement as outlined in the previous point. Earlier the 200 hour MA and 61.8% retracement level held resistance. In between is the 50% retracement level gets in the way at the 1.5365. The price off the low, peaked at this level and is now looking a little more weak than strong.
On the daily chart, the price has been largely contained in a narrow range over the last 5 or so days. This came after a pretty decent move lower last week (it was better than the EURUSD range at least). The consolidation has allowed technical tools like the 100 and 200 hour MA to catch up to the price.
Now the market has a decision to make….Does it want to go higher or lower? The weekly chart below may provide some additional clues. Last week, while the price was moving lower, the price fell below trendline connecting lows from December 2010 and the low from October . That move failed to close below the line. As a result, there may be more traders who might get tired with the downside and look to cover/buy a dip. Use the 100 hour MA as a support stop below. Look for the breach of the 200 hour above to help confirm a more favorable bias and further upward momentum.
Forex News and Commentary by FXDD » Forex Trading
