Buyers enter on Brexit hope
The GBPUSD gapped higher on the Brexit talk extension which give traders hope for a deal. The GBPUSD fell sharply last week - especially on Wednesday Thursday and Friday.
The gap higher today took the pair above a swing area between 1.3283 and 1.3291. The Asian session correction came down to test that area (also the 38.2% of the range since December 4) and found support buyers.
The subsequent run to the upside, tested another swing area between 1.3429 and 1.34408. Sellers leaned against that swing area.
So the pair trades in the meat of the trading range (call it the value area). Yes, there have been extremes above and below that area but most of the trading has occurred between the yellow "goal posts".
On the downside now, the 200 hour moving average comes in at 1.33631. The 100 hour moving average comes in at 1.3331. That is more of a neutral bias zone for today. Stay above that area keeps the buyers satisfied (with hopes of a break outside the upper ceiling - yellow area). Sellers can still be leaners against that ceiling though.
A break below the neutral area (between MAs) would tilt the bias back in the favor of the sellers.
With the pair being influenced by headline news, the wheel of fortune can shift. However, traders can get bias clues from the technicals. Be aware and prepared, however. The dynamics of the influences can lead to choppy up and down trading action, as is evident from the hourly chart above.
