Vote to tighten from Forbes
Kristin Forbes voted to raise rates by 0.25% and that has helped goose the GBPUSD to the upside and the EURGBP to the downside.
The GBPUSD has moved above its 100 bar MA at the 1.2296 level. That level - and the 1.2306 highs from March 2nd and March 15th - are now risk for shorts. The pair approaches the 50% retracement of the move down from the Feb 24th high. That level comes in at 1.23387. We are moving above that level now. There is not a whole lot of resistance on a break. There is a swing low at 1.2349. Above that, and the 1.2383 (see green numbered circles in the chart above) is the next target. The 61.8%, 200 bar MA on the 4-hour and the 100 day MA between 1.2393-1.24039 make up a cluster of resistance which if tested would be a tough nut to crack on the first look at least. So overall...higher the GBPUSD goes.
The EURGBP has just moved below its 200 hour MA at 0.8203. Yesterday it dipped below that level during the early London day tumble lower, but quickly reestablished the price as support. If momentum below the level can be maintained - and the price close below the 200 hour MA - it would be the first close below since February 24th. The downside targets:
- 0.8664. Low from the early London tumble lower yesterday
- 0.8653-55. Swing lows from March 8 and 9th.
- 0.8639. 38.2% of the move up from the Feb 22 low. That area is also home to the swing highs from March 2/3 and near swing low from March 7th.
The vote is a surprise and although only one...FOR NOW.... there are other rumblings from other members to take away the easing from after the Brexit vote.
