Down 221 pips at the lows but at a support area
The GBPUSD has led the way lower in trading today falling as much as 221 pips from the close yesterday. Why? Dollar strength. Rising stocks. Overvalued. Thought that inflation will keep the BOE on hold well into 2016. Fed still has a shot. EU doing better now, so EURGBP has room to rally.
Technically, the price tumbled below:
- Trend line support. at 1.5683
- 200 hour moving average at 1.56737
- Low from Monday at 1.56296
- Low from last week's trading at 1.5561
- Low from August 12 at 1.5528
- Trend line support off the daily chart at 1.5491
The pair has stalled over the last few hours against support at the 61.8% retracement of te move up from June low at 1.54588 and the 100 day MA at the 1.5460. This becomes a risk defining level for the pair.
The stocks are approaching highs for the day and the last hour of trading. The pair remains near the low but is not in a hurry. Has the pair gone far enough? .Or will that 200 day MA be breached. Trading at 1.5466 again.
