What are the technicals telling us in the GBPUSD now?
Price backs off after test
The GBPUSD spiked higher on the Merkel comment on Brexit.
The run higher took the price quickly above the 200 and 100 hour MAs and raced above the highs from Friday and Monday.
However, the pair stallled in a swing area defined by August highs in the 1.21749 to 1.21901 area (see yellow area and post from yesterday HERE). Yes...there was a couple moves higher on August 5th but each failed and resistance was reestablished on August 7th and again on August 16th. You can add today to that swing high group (see green numbered circles).
The price has moved back down to 1.2117 - 7 pips from the 100 hour MA at 1.21108. That MA is now support as the market shifts on the news. It will still take a move above the 1.21749 to 1.21901 level to get more upside momentum going, but intraday, the news is helping the pair.