The GBPUSD has stayed in a 1.6162 to 1.6308 range for nearly the last 8 trading day after surging higher from 1.5824 on September 5th (see chart above). Today the price based against support at the 100 and 200 hour MA levels (blue and green line in the chart below). The holding of this level and subsequent move higher has given the pair a bullish bias within the consolidated range.
If the bullishness is to continue, the next key target to get above is the consolidation ceiling high at the 1.6266-72 area. This level has been tested 3 times in the 8 day period with one failed break higher on September 21. A move above this level will open the door for a move toward the 1.6299 level (high for the year before the new high on Friday) and the high from Friday at 1.6308. Above that and the price has room to roam further higher.
On the downside, the 1.62397 is the 50% of the day’s trading range. The London high yesterday came in at 1.6241. Stay above this area and the bulls remain in control. However, the high for the day at the 1.6266 needs also to be breached. The double bottom today at the 1.6213 and knowing it was also at the 200 hour MA is a strong clue of the willingness to take the price off support. Now “the market” has to follow through with buying of the dips. A dip below the 1.62397 without taking out the high would muddy the water a bit.
