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GBPUSD bounces off Monday’s high on US session correction


Previous resistance to the old floor of the oscillation zone blocked the previous rally.

As reported in a previous article, the GBPUSD climbed up and found resistance in an area oscillating between 1.3725 and 1.3733. The US session has seen a downward rotation.

The fall back during the US session took place despite the drop in rates. The US 10-year is now down -3.3 basis points while the UK 10-year is down only -0.3 basis point on the day.

US stocks remain well supported with the Dow Jones up more than 500 points and the NASDAQ index up 1.67%.

Typically, this combination tends to weaken the dollar as fund flows move into “currency risk” and out of the US dollar.

I guess the techniques had more influence at least in the New York session.

The downward movement in GBPUSD, however, found some support to buy near Monday’s swing high at 1.36738. The low price just hit 1.36747 just above that level. The pair is in the process of tipping higher, with the pair currently trading at 1.36879.

Is the bottom in place?

The GBPUSD low was a lower target and a former high. Correcting and holding above (PS, price also remains above the 50% retracement at 1.36617 on the hourly chart), sets (and solidifies) at least one level of risk for buyers.

Stay above and we might see a rotation towards resistance at the day’s highs.

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