Swing area in the 1.3280-91 area
The GBPUSD gapped at the open below the 100 hour MA (blue line). Tumbled below the 200 hour MA and 50% at 1.34052 (green line) and stepped down to a low at 1.31868. That low stalled near a swing low from December 11, and above the swing low from the month at 1.3133.
The bounce since then, has seen the price run back higher with the pair just reaching 1.3325. That is a near 140 pip rebound from the low. However, the price still remains about 190 pips from the close from Friday. Needless to say, the fall was steep.
However, the rebound has been able to get back above a key swing area between 1.3380 and 1.3391. The low last week bottomed at 1.3380. A number of other lows to November 24th bottomed between 1.3383 to 1.3391 (see red numbered circles). Yes, there have been 4 moves below that area (see red shaded areas) including today's fall below. However, the level still remains a key barometer for buyers and sellers. Stay above keeps buyers in play. Move below and all bets are off. The sellers are in full control.
On the topside, the 38.2% of the move down from the high last week cuts across at 1.33537 and is the next target above. The 50% and the 200 hour MA at 1.34052 is another KEY, KEY level to stay below on any corrective rally for the sellers.
All the news out of the UK points to the downside, but sellers still want to see the topside resistance levels hold and also want to see the run back below the swing area between 1.3280 to 1.3291 to confirm the upside party is over (at least for the time being).
