The GBPUSD chops around but fails to crack low floor

Technical Analysis

Author: Greg Michalowski | gbpusd

1.3450-63 has a number of technical levels that have stalled the fall

The GBPUSD is trading near unchanged on the day now, but stalled ahead of the low from yesterday.  Recall from yesterday, the price fell below the:

  • Low for the year from January 11 at 1.34569.
  • The low from May 10 at 1.3459. 
It also fell below the 38.2% of the move up from the January 2017 low.  That retracement comes in at 1.3463 (see daily chart below).

The pair also tried to move away from the 200 day MA (green line in the chart above). The price of the GBPUSD traded above and below that MA for 8 consecutive days (PS. Today, the price has not touched the 200 day MA at 1.3554).  

With all those levels broken yesterday, one would have expected a run lower. The run did not materialize. 

The low for the day yesterday could only get to 1.3050 before rebounding higher. That was a disappointment.

Drilling to the hourly chart below, in today's trading the price action has seen its share of ups and downs.   With the non-trending volatility, the price has been able to stay below the corrective high from yesterday afternoon at 1.3526. The high reached 1.2520 so far. 

However, the price has also failed to break the low from yesterday and moved back above a higher swing level at 1.3483-85 (see red circled numbers).  The price action is choppy and trying to decide the next break.

With the low being solid (or so it seems), the price is back in the meat of the longer up and down area (see Red box in the hourly chart below).  If the price is to go higher, the 50% of the move down this week at 1.35288, the 100 hour MA at 1.35332 and the 200 hour MA at 1.3540 (moving lower) are hurdles.  Above that the 200 day MA looms. 

On the downside, watch the 1.3483-86 for support. If it holds that would be a clue, the buyers are trying to push the pair higher. A move below and the market may make the 4th run toward the key support floor area. 


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