The GBPUSD has traded lower today and to the lowest level since November 30.
In the process, the price extended back below the 200 day moving average of 1.20791 (see green step down line on the chart above). On December 1, the price first moved above that moving average level, and although the price made small dips below the level including during yesterday’s trading since then, momentum could not be sustained.
Going forward now that the MA has been broken with more momentum, stay below the 200 day moving average keeps the sellers more in control and the bias pointing to the downside.
Looking at the 4 hour chart above, the price today also fell below its 200 bar moving average (lower Green line in the chart above) currently at 1.2016. The price last traded below that moving average on November 4 way down near 1.1232 (up 800 pips currently from that level).
The break below the 200 bar MA on the 4-hour chart could not be sustained. Sellers would now want to see a move below that level to increase the bearish bias.
Overall, failing on the break above the 200 day MA has me tilted more to the downside for the GBPUSD. However, I would also not be surprised to see a move back above IF the 200 bar MA on the 4-hour chart cannot be rebroken in today/tomorrow.
A move back below the 200 bar MA would have traders targeting the 38.2% retracement at 1.1949. That is joined by a swing area between 1.1939 and 1.1954.