Forex technical analysis: GBPUSD new day highs, goes nowhere.
London traders looking to exit the up and down market.
The GBPUSD extended to new session highs as London/European traders look to exit for the day. That extension took the price above swing highs from yesterday as well (see red circles in the chart below). However, that move went nowhere and the price has rotated back lower.
The GBPUSD price action today has been full of ups and downs after yesterday's sharp move lower.. Around the time London traders entered for the day, the price dipped to the low at 1.2106 - taking out the low from yesterday at 1.2122 in the process. Like at the highs, that break went nowhere. It is just one of those days.
Although the buyers and sellers tried to put a stake in the ground at the respective extremes AND both failed, the sellers still are more in control. The selling yesterday took the price below the 1.2200 level and that is now the level that the price needs to get back above IF this pair is to go higher. The peak today at 1.2189 got within 11 pips of that level. Were sellers happy to sell there with stops above? I cannot rule that out as traders fear Brexit more (or so it seems). The good news for traders is the risk at 1.2200 is a solid line. So stay below is more bearish. Move above and it is time to reevaluate.
PS. Looking at the 5- minute chart, we moved to new highs but stalled at the 50% of the weeks trading range (at 1.2188). If the price gets back below the 100 and 200 bar MAs (blue and green lines in the chart below), the sellers will feel more comfortable. The last two dips stalled at the 100 bar MA line (blue line).
PSS Looking at the daily chart, targets are 1.2106-13 (low today and from Oct 28th). and then the post crash lows form October at 1.2087 and 1.2082 (see chart below).