The GBPUSD made new lows today (lowest level since September 9, 2013, but has recovered and is now above the lows from November 2014 at 1.5591 and 1.5588 and the December 1 low of 1.5584. The price is also above the close from Friday at 1.5579 area, and a cluster of lows from the last two months at the 1.5618-284 area.
GBPUSD failed on the move outside the November consolidation
However, it is still below the 100 hour MA at 1.56445 (blue line in the chart above) and 50% retracement at 1.56508. There is a mini battle going on after the 101 pip rally from the lows.
Traders looking for a further upside today should watch 1.5618-284 as close support now.
A move above the 100 hour MA (and staying above it) will be a key technical clue going forward.
Overall, the sellers had a chance to move lower Friday and again today (below November and year lows), and that did not get very far before buyers reemerged. We are back into the November up and down trading range. Is the downside over? Is there more corrective upside potential? Are we just destined to waffle back and forth for the rest of December?
With a range of 101 pips today, the market may have done a pretty good stretch for a Monday, but having said that, watch that 1.5618-28 area for bueyrs. If it can stay above, there may be another push toward the aforementioned levels above and who knows from there. At least if the support can hold, it would carry that little bullishness, into the new trading day tomorrow.
PS. If the upside buyers can stay in control, going forward, the 200 hour MA at 1.5681 (green line) will also be key. Note that the MA held on Friday. Traders remember that. So there will be more work to be done by the buyers at that level if they want to make further progress (look for sellers on the first test, however).
