The GBPUSD has broken out of the goal posts which have contained the pair. I define the goal posts as the 100 and 200 hour MAs (see blue and green lines). When the MAs are wide apart (like they are), and the market breaks above the 100 hour MA, the 200 hour MA often gives traders cause for pause as they are not so anxious to reverse the trend. That is what has happened over the last 20 or so hours – until now (NOTE: the Durable goods data is now out and sending the pair even higher…)
GBPUSD breaks higher. Is
The pair has made a break for it with a move above the 200 hour MA at the 1.5109 currently. Traders – long from against the 100 hour MA (blue line) or on the break of the 200 hour MA, would now want to see the price move away from these MA levels. Note the 50% of the move down from the January 14 high also comes in at 1.5109 level. So there are a couple of reasons to expect buyers against this level (key risk defining level).
As noted yesterday (see: Forex technical trading: GBPUSD back into the meat of the trading range. Tests key level. ) the pair has also moved back into the blue box, defined by the consolidation range going back to earlier this month. The low of that box comes in at 1.5053 and the low today found buyers at the 1.5058 level. Traders like to lean against support as risk can be defined and limited. With the price back in the box and now moving away from the 100 and 200 hour MA, a move toward the recent highs would be targets (if the support /risk levels hold). Interim targets include the 1.5178 (trend line in chart below), and the 1.5200 area.
The hand has been dealt for the buyers. Now we need to see if the market can keep the momentum going and stay above the support levels.
GBPUSD has pushed higher on the weaker Durable Goods orders
