Fall below the 1.4004-11 area does not bother the buyers
The GBPUSD had some key support at the 1.4004-11 area today.
- The April 2016 swing low was at 1.4004 (see daily chart above)
- The June 2016 swing low was at 1.4011 (see daily chart above)
- The 38.2% of the move up from the Jan 11 low (see hourly chart below) was at 1.40053
The price moved below those levels in trading today, moved to a low of 1.39785 and then recovered. When the price moved back above the 1.4004-11, sellers covered and the recovery was on.
The sellers had there shot below that area. They failed and turned the ship around (see the price action on the 5-minute chart below at the 1.4004-11 area).
What now?
The 100 hour MA (blue line on the hourly chart above) comes in at 1.41643. That is the next upside target. The price should give that line respect on a test. Look for some profit taking against the level
ON a break above on a squeeze, the underside of the broken trend line (see hourly chart above) comes in at 1.4198. That is also a nice level to find sellers.
On the downside, watch the retracements of the move higher today (see 5- minute chart). The pair has been trending from the low. The 38.2% of the move up comes in at 1.40848. The midpoint comes in at 1.40645. The 100 and 200 bar MA on the 5-minute chart come in around the 50% and moving higher. Those levels should not be breached if the trend higher is to continue. If they are, the buyers now, may turn back to sellers as the technical picture deteriorates.
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