The GBPUSD moved higher yesterday, reaching its highest level since July 18, 2023, with a peak at 1.3043 before slowing. This move pushed the price above the July 28 high of 1.2995 and the psychological resistance at 1.3000. Today, however, the price has rotated lower, falling back below both the 1.3000 and 1.2995 levels, indicating a weakening in the bulls’ control.
Recently, the price broke below the rising 100-hour MA (currently at 1.29819). Previously, on July 9 and July 10, the price dipped below this MA but quickly rebounded. The key question today is whether the price can stay below this MA for a longer period and continue to decline.
Looking at the hourly chart, the pair has been trending upwards since bottoming on July 2, moving from 1.2614 to yesterday’s high of 1.3043, a gain of 429 pips in 11 days—a significant move in a short period. A correction is possible. The next target is the 38.2% retracement of the recent upward move, at 1.29413. Below that, the rising 200-hour MA at 1.2913 and the 50% retracement level at 1.29099 are achievable targets, representing a normal/modest correction of the trend.
Could the price snap back higher? Yes, a move back above the 100-hour MA at 1.29819 or the high from Monday at 1.2995 would weaken the short-term bearish bias. However, in the absence of such a move, sellers remain in play.
This article was written by Greg Michalowski at www.forexlive.com.
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