Key Highlights
- GBP/USD rallied after it broke the 1.3500 resistance zone.
- A crucial bullish trend line is forming with support near 1.3610 on the 4-hours chart.
- EUR/USD corrected lower from the 1.1480 resistance zone.
- The UK ILO Unemployment rate could remain at 4.2% in Nov 2021 (3M).
GBP/USD Technical Analysis
This past week, the British Pound started a major increase after it cleared the 1.3500 resistance against the US Dollar. GBP/USD rallied above 1.3550 to move into a positive zone.
Looking at the 4-hours chart, the pair even gained pace above the 1.3650 level. There was a close above the 1.3600 level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).
The pair climbed above the 1.3700 level and traded as high as 1.3748. It is now correcting gains below 1.3700. It is now approaching the 23.6% Fib retracement level of the upward move from the 1.3173 low to 1.3748 high.
On the downside, an immediate support is near the 1.3620 level. There is also a crucial bullish trend line forming with support near 1.3610 on the same chart.
If there is a downside break, the pair could test the 1.3460 support. It is near the 50% Fib retracement level of the upward move from the 1.3173 low to 1.3748 high.
On the upside, the pair is facing resistance near 1.3700 level. The next major resistance is near the 1.3750 level, above which the pair could test 1.3880. Any more gains could send GBP/USD towards 1.4000.
Looking at EUR/USD, the pair gained strength above the 1.1450 level, but it faced sellers near 1.1480 and started a downside correction.
Economic Releases
- UK Claimant Count Change for Dec 2021 – Forecast -20K, versus -49.8K previous.
- UK ILO Unemployment Rate for Nov 2021 (3M) – Forecast 4.2%, versus 4.2% previous.
- German ZEW Business Economic Sentiment Index for Jan 2022 – Forecast 32.7, versus 29.9 previous.
