The GBPUSD reached its peak last Tuesday near 1.25246, the highest level since June 10, 2022. On the daily chart above, the price on the move higher, surpassed a swing area between 1.24228 and 1.2447, but selling on Friday took the price below that swing area at the close. Today's high price reached 1.24418 - just below the swing area - before reversing downward. Early US trading has now seen the price decline to a new session lows near 1.23433.
Examining the hourly chart below, the price stalled near the rising 200-hour moving average (green line) on Friday and earlier today. Although there were minor dips below this level, downward momentum was not sustained. The subsequent rally today approached a swing area between 1.2422 and 1.24472, with the 100-hour moving average (blue line) just above it at 1.24508. Today's high reached 1.2439, remained below the swing area and the 100-hour moving average.
During early US trading, the 200-hour moving average (green line at 1.24050) was finally breached with momentum. The price has now moved down to the next swing area between 1.2343 and 1.23603, where buyers are attempting to defend support. If this area holds and the price rises above 1.23603, upside resistance would be near Friday's low at 1.2388. Moving back above the 200-hour moving average would discourage sellers seeking further downside momentum, potentially leading to increased upward movement.
However, if the price fails to move above 1.23603 NOW, the downside remains the path of least resistance for traders. On a break of 1.2343, the next major target range from 1.22608 to 1.22823, and the 38.2% retracement of the move up from the March low at 1.22485 would be targeted.
Overall, sellers are currently in control – the question is whether they can maintain their momentum. Stay below 1.23603 is the best case scenario for increased downside momentum today. Move above that level, and we could see some corrective upside probing with the low from Friday and the 200 hour moving average topside resistance targets.
