Forex technical analysis: GBPUSD falls. EURGBP pushing high close

High close this year for the EURGBP? 0.8581. Being tested

The GBPUSD ran out of steam on it's rally in trading today. There is much talk on the decline in the UK 10 year which is trading at all time low levels of 0.553%.  Since Brexit the 10 year yield has moved from 1.373 to the low today.  The currency market may have felt a little of that yield fall.  

Also helping the decline in the GBPUSD has been the run up in the EURGBP. It has made a run for the high closing level at the 0.8581 level (the high reached 0.8582 so far and trades at 0.8575 currently). A move above that 0.8581 level will have the pair looking toward the post -Brexit high at the 0.8624 level. That level represented the highest level since Aug 28, 2013. PS the swing high from Oct 29, 2013 (the last swing high going back in time) peaked at 0.8584. So there is something about this current area that may give traders cause for pause.

Looking at the GBPUSD, the pair bottomed nicely against trend line support yesterday (see -4-hour chart below). The rally higher took the price back toward the corrective highs after the US employment report from last week near the 1.3100 level. The high reached 1.3093 today. The 61.8% of the move down from the pre-employment high was also tested at 1.30904 level (see 4-hour chart below).  

The subsequent fall has taken the price below the 1.3047 level. Now that yellow area in the chart above - between 1.3047 and 1.3074 has seen lots of choppy trading on the 4-hour chart. However if you look at the 5-minute chart, there has been times when "the market" seems to lean against the level. Today, the fall below that level corresponded with trend line and the 200 bar MA on the 5-minute chart.  On a correction higher, look for traders to once again lean against the level as a risk defining level.   That is close risk for traders.  

If the topside can hold, the pair would once again be looking toward the 1.3000. That level - because it is such a round number - will always act as a bullish/bearish barometer for traders.  A move below will look toward the week's low at 1.29547 and then that lower trend line on the 4-hour chart. That would be further down the road however.  

For now, let's see if 1.3047 have keep a lid on the pair and also keep an eye on the EURGBP for clues.