GBPUSD reverses a key retracement level, potential for further downside

The GBPUSD moved above the next upside target at the 61.8% retracement of the move down from the July 2023 high. That level came in at 1.27189. The price moved up to 1.2732 on the break but then backed off and when it did, the buyers turned more to sellers. Traders started to lean against the retracement level once again, and that ultimately led to a move lower.

The price low for the day reached 1.26639. The current price is trading around 1.2690. The 61.8% retracement is a 1.27189.

If the sellers are to start to exert more control, staying below the 61.8% retracement is important technically. Traders who think there is room for a correction lower, would not want to see the price move above that level.

On the downside, getting below a rising trend line on the hourly chart near 1.2653 would have traders looking toward the 100-hour moving average at 1.26196 , and then a swing area at 1.2614. Below that and the 50% midpoint of the move down from the July 2023 high comes in at 1.2588. That is joined by the 50% midpoint of the move up from the November 22 low at 1.2590.

In this video, take a look at the technicals that are driving the GBPUSD traders with a bias tilt that the high may be in place as a result of the failed break of the 61.8% retracement today. If so, we should see a rotation lower. If the high is not in place, traders can use a 61.8% retracement as a stop loss level. Getting and staying above that level would keep the buyers firmly in control technically

This article was written by Greg Michalowski at Source