The flash crash low is breached .
Back on January 3rd, there was a dreaded flash crash that sent the price of some currencies sharply lower, The fall was mainly on the back of low liquidity at the start of a new day. The price of various currency pairsmoved sharply BUT quickly reversed the moves. The GBPUSD did just that (see daily chart below).
For the GBPUSD, the low according to Bloomberg on January 3rd, reached 1.24417. The low today just took that out by a few pips to 1.24389. The price has rebounded from that low and is trading at 1.2462 currently.
The pair has been trending lower today on the back of Brexit risks and slower growth
Technially, the pair fell back below the June 18 low at 1.2505 (and the 1.2500 level. The low yesterday stalled at 1.2499), and the low from Friday's tumble low at the 1.24805 level. That gave the sellers the confidence to go after that 2019 low target. The 1.24805 will be eyed by both buyers and sellers now. Move above and the buyers are taking back more control.
Now that the old 2019 low has been reached, the market seems to be a little more balanced.
Drilling to the 5 minute chart, the price is above a trend line now and moves toward the 38.2% of the trend move lower at 1.24668. The falling 100 bar MA (blue line) is at 1.24725. Watch those levels for sellers/buyers. If the low is in place against the old flash crash low, breaking above those levels would muddy the bearish trend waters. Stay below, and sellers may make another push lower.
Traders have to be careful for the double bottom, and sellers seem to have taken the opportunity to lighten up (with the bounce off the bottom). If it is a turning point for the move down since the last peak on June 25th (at 1.2783), time will tell, but the price action and tools will show it.
