Despite a 50bp hike from the Bank of England this week, GBPUSD is trading lower this week. Concerns about slower growth despite high inflation weigh on the currency pair today.
Technically, the GBPUSD price fell back below its 200-hour moving average at 1.27312. Staying below the moving average keeps the bias in favor of the sellers at least in the short term. However, there is work to be done as the swing area between 1.2689 and 1.2698 needs to be broken and remain broken for sellers to gain more confidence. Below that is the 38.2% retracement of the move up from the May 25 high at 1.26413. Getting below each would increase bearish bias and is needed from a technical standpoint to show that the sellers have some strength.
A near-term risk for shorts is a momentum move back above the 200-hour moving average at 1.27312 followed by a move back above its 100-hour moving average at 1.27561 (green and blue lines in the chart below).. Price tried to move above the 200-hour moving average outside of the corrective move above , but he didn’t get very far.