The GBPUSD has moved down to test the 50% midpoint of the weeks trading range at 1.32718. The low price just reached 1.32704 and bounced modestly on the first test.
Looking at the five minute chart below, the low was reached on Wednesday at 1.3170 soon after the FOMC rate decision which saw the fed increase the taper and show they expect near three tightenings in 2022.
During trading yesterday, the pair was able to stay above its shorter-term 200 bar moving average on two separate tests (see green line in the chart above) and spiked higher after the Bank of England rate decision (increased the short term rate by 15 basis points to 0.25%). The high price extended to 1.33735 before retracing back lower toward the 1.3300 level.
In trading today, the up and down price action in the Asian and early European session, has led to a rotation to the downside and the move away from the short term 100 and 200 bar moving averages (blue and green lines). The 50% midpoint of the weeks trading range seems to be getting in the way at least for now, and giving traders cause for pause. The rising 100 hour moving averages at 1.32583. The closing level from last week came in around 1.3262. So those levels are other support targets on further tilt to the downside.
Taking a broader look at the 4-hour chart, also in play is key 100 and 200 bar moving averages.
Looking at the chart below, the spike high after the Bank of England decision yesterday took the price back toward the swing high from November 30 at 1.33694 (the high price reached 1.33735). That high price also stalled just ahead of its falling 200 bar moving average on the 4 hour chart (green line in the chart below). That level comes in currently at 1.33721.
The subsequent fall lower over the last 24 hours has moved the price back toward the flattening 100 bar moving average (blue line) on the 4 hour chart at 1.32725. The price has moved below that level to 1.32704, but has bounced modestly. That moving average line along with the 50% midpoint of the move up this week, is helping to stall the fall. However a move below would tilt the bias more to the downside for the dual reasons.
So the pair is lower and more bearish intraday, but the GBPUSD is also investing some key support at the 50% of the weeks trading range and the 100 bar moving average on the 4-hour chart. Can the buyers hold support? That is the key technical question now.
