The GBPUSD has snapped back to the upside after tamer core PCE data. The move to the upside comes after the pair tested a swing area going back to June 12 – 14 (see green number circles) and the swing low from Wednesday’s trade at 1.2599. Recall yesterday, the price also tested that level then fell below but quickly rebounded. The low price today reached 1.25985.
The move to the upside was given a boost after the core PCE data in the US today came a touch lower than expectations at 4.6% versus 4.7%. That helped to weaken the US dollar. Yields in the US erased earlier moves of the upside.
Technically, the price moved above its 100-hour moving average of 1.2678, and then above what was a key swing area between 1.2687 1.26988 (see red number circles on the chart below).
What has stalled the pair is the 200-hour moving average at 1.27099.
Looking back, that 200-hour moving average found willing sellers last Friday, Monday, Tuesday, and again on Wednesday before moving sharply to the downside. As a result, it makes sense to find sellers on the 1st test against that moving average. However, a move back below the 100 hour moving average would be needed to give the buyers some cause for pause.
On the top side, a move above the 200-hour moving average, would open the door for a potential run toward the highest for the week at 1.2759.
This article was written by Greg Michalowski at www.forexlive.com. Source