GBPUSD looks toward 50% retracement target. Key target to get to and through now.

The GBPUSD is trading to a new high going back to September 22, and in the process is stretching toward its 50% midpoint of the move down from the September 11 high. That level comes in at 1.22919. Getting above that level increases the bullish bias from a technical perspective.

The move to the upside was able to get above the September 29 swing high at 1.22715, and other swing highs from earlier today up to 1.2273. That area will be now close risk for traders looking for more upside.

The 50% midpoint can always be a level where traders take profit or look to put on a new countermove position. The reason is risk can be defined and limited against the level.

Having said that, traders on counter move positions need confidence that they are right on the trade. In the short term, I would watch the 1.2271 swing high from September 29 as a level to get below for sellers to feel more confident that a high is in place. If the price can get below that level, the sellers can potentially look for a move back to the 38.2% at 1.22316. Absent that, and the sellers are not winning. The buyers remain in firm control.

This article was written by Greg Michalowski at Source