Key Highlights
- GBP/USD started a downside correction from the 1.2850 zone.
- A major bearish trend line is forming with resistance near 1.2740 on the 4-hour chart.
- EUR/USD remained well-bid above the 1.0850 support zone.
- Gold price is showing bearish signs below the $1,940 resistance.
GBP/USD Technical Analysis
The British Pound rallied after it broke the 1.2750 resistance against the US Dollar. GBP/USD even tested the 1.2850 resistance before the bears appeared.
Looking at the 4-hour chart, the pair saw a downside correction from the 1.2850 zone. It traded below the 1.2800 and 1.2780 levels. There was a break below the 38.2% Fib retracement level of the upward move from the 1.2487 swing low to the 1.2848 high.
However, the pair is still well above the 100 simple moving average (red, 4 hours) and the 200 simple moving average (green, 4 hours).
Immediate support is near the 1.2665 level. It is close to the 50% Fib retracement level of the upward move from the 1.2487 swing low to the 1.2848 high. The next major support is near the 1.2620 level and the 100 simple moving average (red, 4 hours).
If there is a downside break below the 1.2620 support, the pair could decline toward the 1.2550 support. On the upside, the first major resistance is near the 1.2740 zone and a bearish trend line on the same chart.
If there is a move above the 1.2740 resistance, the pair could rise toward 1.2800. Any more gains might send EUR/USD toward the 1.2850 level.
Looking at EUR/USD, the pair remained well-bid above 1.0850 and is currently attempting a fresh increase toward 1.1000.
Economic Releases
- Canadian Consumer Price Index for May 2023 (MoM) – Forecast +0.5%, versus +0.2% previous.
- Canadian Consumer Price Index for May 2023 (YoY) – Forecast +1.7%, versus +1.6% previous.
- US New Home Sales for May 2023 (MoM) – Forecast -0.9% versus -3.4% previous.
