Topside trend line stalls the rally today.
As we head into the weekend, and trader prepare for next week, the price of the GBPUSD has a couple of technical levels that will define the bias in trading next week.
The first comes from the daily chart.
Looking at that chart, the price yesterday broke above a topside trend line and raced higher. That break did not last, however, and the price rotated lower. For a pair that rose nearly 900 pips from the December low, that red flag is key. Today, the high price stalled ahead of that old trend line at 1.4283. The high today stalled at 1.4281. Stay below and the price can correct/move lower.
The second key technical level comes from the hourly chart (see chart below).
Looking at that chart below, the pair is approaching the rising 100 hour MA at 1.41248. The price of the GBPUSD has not been below the 100 hour MA since January 11. A move below that MA will be more bearish. Holding it – or failing on a break below it – will be more bullish.
The price is trading at 1.4145 currently. The 100 hour MA is about 20 pips away. As a result, it will probably not be until next week (that would be better anyway), for a clearer picture. Nevertheless it is always good to prepare.