The EURGBP fell to its low for the week in Tuesday’s session, and thus tested the 200-hour moving average. Support buyers leaned against the level (it was also a low from last week) and sellers looked to buyers.
The price rise from Tuesday’s low saw the 100-day and 100-hour moving averages break to 0.8512 (Wednesday – see blue lines).
The 200-day moving average was the next key technical level to cross on the same day. This breakout led to an increase in the upward momentum.
The week’s high price hit 0.85985, surpassing the November high at 0.85944 – but only 4 pips. This failed break led the buyer to turn to the sellers.
Yesterday’s price fell below the 200-day moving average at 0.85552, and today the 100-hour moving average that rose to 0.05353 was also broken.
However, so far the rising 200 hour moving average at 0.85250 has maintained support. The current price is trading between these two hourly moving averages. There is a reason to stop.
And then ?
It will now be necessary to move below the 200 hour moving average and below the 100 day moving average at 0.8513 to further increase the bearish bias of the pair.
Conversely, if the 200-hour moving average can hold support (or the 100-day moving average for that matter), and the price can climb above the 100-hour moving average with momentum, traders will turn. again towards a further breakout of the 200-day moving average at 0.8555 to signal that buyers are firmly in control.
So there is work for sellers to do if they want to gain more control, and more work for buyers to do if they continue to show more strength. Look at a technical level for the clues. For now, buyers and sellers are competing.