Key Highlights
- GBP/USD started a downside correction from the 1.2825 resistance.
- It traded below a key bullish trend line with support at 1.2715 on the 4-hour chart.
- EUR/USD also corrected lower below the 1.1020 support zone.
- The US ISM Manufacturing Index could increase slightly from 46.7 to 47.1 in Dec 2023.
GBP/USD Technical Analysis
The British Pound faced resistance near the 1.2825 zone against the US Dollar. GBP/USD formed a short-term top and started a downside correction below 1.2750.
Looking at the 4-hour chart, the pair traded below a key bullish trend line with support at 1.2715. There was a spike below the 50% Fib retracement level of the upward move from the 1.2611 swing low to the 1.2827 high.
The pair even broke the 100 simple moving average (red, 4 hours). The next major support sits at 1.2610 or the 200 simple moving average (green, 4 hours).
A downside break below the 1.2600 zone could spark a sustained decline. The next major support is 1.2520, below which the pair might decline and test 1.2450. Any more losses might send the pair toward the 1.2300 zone.
On the upside, immediate resistance is near the 1.2680 level. The next key resistance is near the 1.2720 level. A close above the 1.2720 zone could open the doors for more upsides. The next stop for the bulls might be 1.2800.
Looking at EUR/USD, the pair also reacted to the downside and the bears were able to push it below the 1.1020 support.
Economic Releases
- US ISM Manufacturing Index for Dec 2023 – Forecast 47.1, versus 46.7 previous.
