Moves back above 200 day MA in trading today
The GBPUSD has surged higher in trading today. The move has taken the price back above the 200 day moving average in trading today (at 1.54347 - not shown). The pair closed below the level on Wednesday for the 1st time since June 9, but momentum slowed in trading yesterday and the pair squeeze higher today.
Looking at the 4 hour chart above, the price move higher has been able to pierce the 200 bar MA (green line in the chart above)at the 1.5530 level. The high extended to 1.5550. The 38.2% retracement of the move down from the June 18 high comes in at 1.55576. The price is back down below the 200 bar MA level. The failure above may solicit more profit taking after the surge higher. Watch the level.
On the hourly chart, the price is also moved above ITS 200 hour MA (green line in the chart below) currently at 1.55385. Like the 4 hour chart, The move above has reversed and the price is now below. It too will be eyed as resistance (risk defining level for traders looking to take profit or put on a trade).
The range today is 187 pips. This is well above the 120 pip average over the last month of trading. Is it extended too far too fast? Trends can go farther then expected. So I stress caution in fading the strong trend. However, watch the aforementioned resistance levels as risks defining levels. Stay below is ok for the seller up here. A move above would be a concern though
Where is support? Close support will be eyed at the 1.5491 and 1.5473 levels. This is the 38.2-50% of the accelerated trend move higher. Given the trend move higher today, there should be buyers in this area. If so, I would expect more up and down activity to dominate with the 200 MAs as above and the 50 % below.
