100 hour being breached for the first time since Tuesday’s tumble
The GBPUSD is trading back above its 100 hour moving average at 1.35363. It is also moving back above its 38.2% retracement of the move down from the September 23 swing high at 1.35405. Those hurdles are the minimum if the buyers are to seize more control.
The high from Wednesday at 1.35538 is the next close target to get to and through followed by the 50% midpoint of the same move lower at 1.35805 and the falling 200 hour moving average 1.36054.
Recall that on Tuesday, the 100 hour moving average was broken after unsuccessfully moving above its 200 hour moving average (green line) and failing. That was the pattern on Monday as well. Once the 100 hour moving average (blue line) was broken on Tuesday, the buyers turned sellers and the price tumbled as dollar buying in technicals took control. On Wednesday there was a modest bounce before another run lower. Yesterday the price chopped higher with the high price stalling near the low from Tuesday’s trade.
US stocks are getting a boost in premarket trading help by the market news of a Covid 19 antiviral pill that reduces hospitalization rates by 50%. Any news that increases global reopening and reduces fears of Covid is good news for growth and global health. That has the dollar moving back to the downside.
The bad news still is that supply chain concerns continue to be a problem and increased global confidence could lead to a further demand for goods/inflation.
Nevertheless, the dollar is increasing its bearish run against the major currencies