Market is unsure....
The GBPUSD price action is up and down choppy today. Is that all surprising? Probably not. Remember yesterday, the price continued to fall, BUT stalled right against the 50% of the move up from the October 25th low at 1.23774. The low reached 1.2379. That level also corresponded with might end up being a neckline trend line for a head and shoulders formation.
The rally higher was helped by a news report about Brexit (which was really old speculative news about Brexit taking 2 years to come to a conclusion). When the market gets whipped around like that, it makes traders more cautious. When traders get in that mood, they trade defensively. We are seeing that today.
Looking at the hourly chart, traders leaned against the 100 hour MA on the topside. at 1.2507. A broken trend line also cut across near that level. Traders leaned..
The move lower stalled at 1.2408 today. There is nothing special about the level. However, the move off that level, found sellers near the 200 hour MA at the 1.24667 level. The high came after the weaker Industrial production data.
What now?
Technically, held below 100 hour MA. Stalled near the 200 hour MA. Below broken trend line. Does below 1.2500 matter? Maybe. The high today reached 1.2501. We can envision a break of the neckline and see the head and shoulder trade potentially come into play.
BUT....
Do you love/Do you trust the GBPUSD market? Let me say, I would feel more comfortable trading against a technical level in this pair. Even so with ups and downs, I cannot be too sure that resistance or support will hold. At least risk can be limited. If risk is limited, the potential to make more than the risk is not that great a hurdle. So traders take profit and are happy.
Someone asked me other day. "I am trying to attack a currency trend" but get chopped up in choppy markets. What do I do?'" If you outline the key levels (like the 50% below and perhaps the 100 hour MA below), you have something to base bulllish/bearish. A trend does not have to be 300, 200 or even 100 pips. It can be A move from the 100 hour MA to the 50% like it did yesterday. It could be selling against the 100 hour MA at 1.2500 above today and buying at the 200 hour MA at 1.24667. That might be your trend today (even though it went lower). That is ok. Just look for the next trade where you feel comfortable against a level. If you don't like the level, don't force the trade. There will be a better trade. You just have to be patient.