The move up from the election new low was broken yesterday (and stayed below it today) in more up and down trading
The GBPUSD is lower for the third day in a row him after running higher last Friday after the exit polls from the UK election tilted largely in favor of Boris Johnson and the Tories.
As we know, that euphoria was short-lived as markets first corrected lower, and then selling became more serious. The price tumbled more yesterday after reports that Boris Johnson would pose legislation that would put a and date for leaving the EU by December 2020. That did not sit well with the market (all we need is another hard deadline that keeps a hard Brexit alive). In the process the 100 and 200 hour moving averages (blue and green lines) were broken (and have remained broken) at 1.32644 and 1.32110 respectively him him.
Today, the pair has seen more choppy action. However, the price has been able to stay below the 1.31388 level. That level corresponds with the swing low just as the first exit poll from the UK election was released. It can be a risk level for traders. Stay below is more bearish.
The price today has also chopped around a swing area between the 1.30998 and 1.3111 level (see yellow area in the chart above). If there is a correction toward that area, look to see if sellers leaned and keep the pressure more to the downside.
The next obvious target is the low from last Thursday's trading at the 1.30494.
Taking a broader look at the weekly chart, the price today has moved back below its 200 week moving average at 1.30852. We are just below that level now. Stay below would be another bearish signal.
Further to the downside, the 100 week moving average comes in at 1.30352 and that would be another key target. Get and stay below that level and the buyers continue to lose technical control.
