It’a all go in the pound today
Just some colour to go with the moves we’ve just seen. There was a lot of technical sell interest up around 0.8880-0.8900, as we’ve seen over the last few days, and indeed in Sep.
That’s all been cleaned out and stops were hit above the 100 DMA at 0.8901. Those stops have been big enough to push the pair up to 0.8933. If the buyers have really taken this buy the scruff of the neck, we hould see decent support now against the broken area, and probably some stops starting to gather just below.
The move has also tipped GBPUSD through a strong support level around 1.3215/20, and stops were sitting just below there and 1.3200 also. 1.3220 was an S&R level through Sep and Oct and the 50 fib of the August rally was at 1.3216.
On Tuesday I wondered whether this was the end of the Aug rally, and I was offered at 1.3295 yesterday in the hopes that we’d get a test of 1.33. 1.3292 was the high and I didn’t follow my own rules of not being a dick for a tick, so missed out. But, crying into my cornflakes about missed opportunities doesn’t pay the bills so we now need to look at the next trades.
For cable, the 200 H4 at 1.3186 got taken out in this stop run but we were quick to get back above it so it may have a bit more of a say next time. There’s more technical support down at 1.3160 via the 11/12th Sep lows. Then we have the 55 dma down 1.3128, which comes just ahead of the 61.8 fib of the Aug rally. That and 1.3100 will be the real line in the sand for this rally.
Back to EURGBP and the next resistance is right here at 0.8920/25 followed by the 38.2 fib of the Aug drop.. Above there is an S&R level at 0.8980/85 which is likely to show some good strength as it’s just under the big 0.90 level. That has the 55 dma sitting just above at 0.8912.
As always, if these moves are to continue onto the next level, we’ll need to see signs of resistance/support building at the break areas. If the don’t then those area will firm up again.