The GBPUSD is inching closer and closer to the next major target at the 1.6461 level (see prior post at https://www.forexlive.com/blog/2014/09/02/gbpusd-trades-at-new-lows/) . The low to high trading range is 143 pips which makes it the 11th largest trading range for the year. The largest range came on January 2nd at 195 pips. Being what many consider the end of the summer and the beginning of the last push for profit, today’s start is encouraging. Hoping for the more day’s like today to be in the future.
GBPUSD moves closer to support.
The move lower will have it’s first main support test since the 200 day MA break. In mid August the price tested the 200 day MA and bounced higher. A few days later the price moved through the level and has not closed above that level since.
The pair has come down about 720 pips from the high now. It has taken about 6 or 7 weeks to do it. The 38.2% of the move up from the 2013 low comes in at 1.62814. The low for the 2014 comes in at 1.6251. These levels are on the radar should the selling from the Scottish referendum vote continue to pressure the pair. Fear can be tough to stop.
It is during the fearful times, that having a technical bias that defines and limits risk is most important as the price and tools don’t lie. Watching support at 1.6461 but understand a move below should not be taken lightly.
Looking at the 5 minute chart, the price of the price momentum is slowed but the trend is still down. Corrections higher have been shallow. The price remains below the topside trendline at 1.6481. and above that 38.2-50% and 100 hour MA (blue line in chart below) at 1.6496-1.6504 area.
GBPUSD 5 minute chart continues to show sellers in control.
