200 are moving average stalled the rally. The move back lower has retested the 100 hour MA
The GBPUSD is ping-pong between hourly moving averages. As per an earlier post, the move off the swing area at 1.38584 and the 100 hour MA, opened the door for a move toward the downsloping trendline and 200 hour moving average at 1.3922. That moving average found sellers leaning against the level. The high price reached 1.3924 before rotating back to the downside.
The subsequent moves to the downside has moved back to retest its 100 hour moving average at 1.38796 (see blueline in the chart above). The low price just reached 1.38799 and bounced.
Buyers are trying to take more control on the correction probe back to the upside today, but is running into resistance sellers against a key MA level.
What increases the levels of importance is that at the highs last Thursday, the price also tested the 200 hour moving average and found willing sellers (at 1.4012). That stall led to a sharp fall which culminated in the payer reaching the low on Friday at 1.3772.
As a result, traders will be cautious as to the extent of their bullishness. Nevertheless the 100 hour moving average – followed by the 1.3584 level - will give dip buying traders the needed backstop. Stay above and the buyers are still in the game. If the price moves below, we should see the buyers give up.
