The GBPUSD continued the fall started yesterday in Asian and early London trading.
The price first moved below the 50% of the move down from the 2012 high at 1.57833. Broken.
- The 200 hour MA (green line in the chart below) was up next. Broken.
- Trend line support on the daily was the next target at 1.5761. Broken.
- The combination of the 38.2% of the move up from the August low at 1.5796 (see chart below) and the 100 day MA at the 1.5743 proved to be too hard to overtake however (low reached 1.57527) and the rally back higher began.
NY has taken the price to new day highs at the 1.5799. The underside of broken trend line at the 1.5807 and the 38.2% of the move down from the August 22nd high at 1.5813 will be the next targets, followed by the key 100 hour MA at the 1.58274 currently. The 100 hour MA will be a key borderline for the pair if the rally is to continue higher.
On the downside, the close risk/buying support is down at the underside of the broken trend line on the hourly chart at 1.5779 and the 200 hour MA at the 1.57749 level currently. The last hourly bar based off this 200 hour MA level. If the buyers are serious, they will keep the price above this line (look for early buyers at the 1.5779 area). If the market does not have the buying support, it says to me the market is simply not all that convinced as to the direction just yet. Watching the correction for the early NY clues but not looking to risk too much.