High today stalls at underside of broken trend line
The GBPUSD is trading at a new session low at the 1.3937. That is the lowest level since March 19th. The April 5th low at 1.39648 was breached today too.
Looking at the daily chart above, a lower trend line was broken on Friday, and the price closed below that line. Today, the underside of that trend line was tested, but held at 1.4031. Bearish. Remember last week, the high price took out the January 2018 high at 1.43448. The high reached 1.43762, but that break failed. This is the 5th down day in a row for the pair.
The 100 day MA come in at 1.38474. That will be a target on continued weakness. The GBPUSD has not traded below the 100 day MA since November 13th and only has 6-7 daily closes below the 100 day MA since March 2017.
Drilling to the hourly chart below, the 1.3965-814 is now risk for shorts. On the downside, a lower trend line cuts across at 1.3929 (and moving lower). There may be some profit taking on a test of that line just because it is there and risk can be defined and limited.
SUMMARY: Seller have been in control for 5 straight days. That includes today's run.
Over that time,t he price has stepped below the
- 100 hour MA,
- 200 hour MA,
- 100 bar and 200 bar MAs on the 4-hour charts and
- today the low from earlier in the month, and
- Stayed below a broken trend line on the daily chart.
The 100 day MA remains a key target, but it is 100 pips away (or so) at 1.3847.
A close target in the short term is 1.3929 with close risk now at 1.3965-81.
