The GBPUSD tumbled lower yesterday on the back of the flight into the USD and in the process reached a low of 1.3272. That low stalled within a swing area between 1.32726 and 1.3291 (see blue numbered circles) that defined and up and down range near the extremes from November and December 2021 (see red shaded area).
The subsequent run to the upside took the price above a second swing area between 1.3557 and 1.3377 (see red numbered circles), and today up to a third swing area between 1.3430 and 1.3439.
The price action has settled today between the last two (higher – see green and red numbered circles) swing areas, with the price currently trading between those levels at 1.3383 (as I type).
Drilling to the 5 minute chart below, the trading price action this week started to head lower on Wednesday with the more away from the 100/200 bar MAs (blue and green lines in the chart below). The successful test of the 100 hour MA early on Thursday was bearish and falling away from the 100 day MA (at 1.3498 currently) was also a bearish play.
The fall below the swing area on the 4-hour chart between 1.3357 and 1.3377 tried to stay below the area on the first correction off the lower but moved back above, and started to find support buyers in the area (at 1.33678). The price moved higher today peaking near the high of the higher swing area on the 4-hour chart.
The price is currently back below the 100/200 bar MAs after last testing the 38.2% on the London/early NY correction at 1.34117. Bearish. Moreover, the price action looks head and shoulder-ish with a break below 1.33678 and then 1.3357, increasing the bearish bias in the short term.
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