Moving him him him up toward resistance targets
The GBPUSD moved sharply lower yesterday as risk off trades dominated. The low price extended below a trend line (see green numbered circles on its way to the session low at 1.22464. A modest correction into the close still kept the price below the overhead broken trend line.
Today, however, after testing the underside of the broken trend line at green circle 4, the price action was able to move and stay above that line. The old trend line currently at 1.2322 is now a risk level for longs. We are seeing retraces of some of the declines over the last few days.
The last 5 or so hours of trading has seen a modest run to the upside with the price peaking at 1.2385. That is near some modest resistance from the April 7 swing high and some swing lows seen in yesterday's trading at 1.2388 and 1.2382 respectively. The buyers are making a play, but running into modest resistance.
Should the price momentum continue today, there is resistance defined by the 38.2% retracement of the move down from the April 14 high. That comes in right around the 1.2400 level. Above that is its 100 hour moving average 1.24177 and a topside trend line at 1.24345. The 50% retracement at 1.2446 and the 200 hour moving average at 1.24698 complete the cluster of resistance that lies above on further retracement price action him.
Drilling down to the 5 minutes chart, the price has moved away from its 100 and 200 bar moving averages (blue and green lines in the chart below). The rising 100 bar moving average currently comes in at 1.2333. That moving average line is a close intraday risk level for longs. Stay above is more bullish. Move below, and we could see further probing toward support on the daily chart at 1.2322 and the rising 200 bar moving average 1.23136.
