UK on holiday. GBPUSD also on holiday
The UK has its summer bank holiday and the trading in the GBPUSD seems to be taking the day off as well. The pair is trading in a 42 pip trading range for the day. The average over the last 22 trading days is 115 pips.
Taking a step back from the intraday and looking at the daily chart, the pair sits between the 100 day MA above (blue line) and the 200 day MA (green line) below (at 1.54819 and 1.5365 respectively). The price fell below the 200 day MA for the first time since July 10 on Friday but could not close below that key MA level. The pair found support buyers on Friday near the 1.5329 level (1.5334). The low in July came in at 1.5329. Since May 8, the GBPUSD has traded mostly between 1.5329 and 1.58016 (66 of 81 days has traded between that range with 8 total trading days settling outside the range). I know it is nearly 500 pips but there is no trend over that period. The price has been up and down and down and up. We are currently down. With the price settled between the 100 and 200 day MAs, the "market" is saying it is not ready to make a break just yet.
This week, the economic schedule is light in the UK with Manufacturing, Construction and services PMI data. Next week, the BOE has their interest rate meeting. With economic activity light, it might be more of a dollar trade this week. US employment on Friday is the highlight of course with a trend like gain of 220K expected.
So what is the intraday technicals showing? The pair has a ceiling against a topside trend line That trend line is now near the 100 and 200 bar MA on the 5 minute chart (all near 1.5418). This is the risk for the sellers and the sellers have the upper hand technically.
ON the downside, the 1.5395 is a lower trend line and also the 38.2% of the move up from Friday (at 1.5397). A move below that level will be more beairish with that importand 200 day MA at 1.5365 looming as another key support target.
If the trend line can be broken above, look for the highs to be tested. I know it is a holiday in the UK, but the pair should make a run at an extension.
