GBPUSD moves up to 1.2900 area. Coming back off.
The EURGBP took a turn to the downside, and in the process, sent the GBPUSD through resistance at 1.2876 (200 bar MA on 4 hour chart AND the 38.2% retracement). The GBPUSD moved quickly to 1.29000 area, but has since backed off. Traders will be eyeing the 1.2876 area as support now. A move below will make the break not look that great technically.
Back to the EURGBP, the high today stalled near a topside trend line on the 4-hour chart. The price moved above that line last week, but failed. Yesterday and again today, the price moved to test that line and stalled. That slowed the rise.
Drilling to the 5 minute chart below, the price fell below the 100 and 200 bar MAs (blue and green lines) and has moved down toward the next support at the 0.8700 area (50% and 100 hour MA line). If the price moves below the 0.8700, the sellers have more control.
When the EURGBP starts to get involved, it can muddy the waters for the related pairs. The fall in the EURGBP after testing resistance at the highs, helped push the GBPUSD higher to test the next target level (at 1.2900 area). A further move lower in the EURGBP (and break below the 0.8700 level) has the potential to muck up the water even more. So keep an eye on that level. The tail (the EURGBP) may start to wag the dog (the GBPUSD and EURUSD).
