Can the broken 50% hold?
The GBPUSD is moving back down after testing a swing area in the 1.25137-214 area and reversing. The price is now retesting the 50% retracement of the move down from the April 14 high to the April 21 low on the hourly chart below. That level comes in at 1.24466 level.
Recall from yesterday, the price did try to break above that level on a few occasions only to back off each time (see red horizontal line). The fall ended up basing near the 200 hour moving average and the broken 38.2% retracement (both currently at 1.23994). Today the price based against both of those technical levels before moving sharply higher. Buyers stating control.
The current retracement back down toward the 50% retracement is a key test for bulls (and the sellers for that matter). Move below and we could see a further unraveling of the gains today. Stay above and the buyers hold onto intraday control, but would have to build back higher toward the 61.8% retracement at 1.24938 and the swing area near the highs for the day.
PS. The EURUSD has also moved back lower and in the process moved back below its 50% retracement at 1.08576. It is looking to test its 200 hour moving average at 1.0836 currently (see earlier post)
