Key Highlights
- GBP/USD started a decent increase above the 1.2320 resistance.
- A connecting bearish trend line is forming with resistance at 1.2500 on the 4-hour chart.
- EUR/USD started a downside correction from the 1.0520 zone.
- Gold could aim for a fresh move above the $2,770 level.
GBP/USD Technical Analysis
The British Pound found support and started a recovery wave above 1.2250 against the US Dollar. GBP/USD climbed above 1.2320 to move into a short-term positive zone.
Looking at the 4-hour chart, the pair was able to surpass 1.2420 and the 100 simple moving average (red, 4-hour). However, the bears were active near the 1.2500 zone and the 200 simple moving average (green, 4-hour).
A high was formed at 1.2523 and the pair is now consolidating gains. On the downside, immediate support sits near the 1.2360 level or the 38.2% Fib retracement level of the upward move from the 1.2099 swing low to the 1.2523 high.
The next key support sits near the 1.2320 level and the 50% Fib retracement level of the upward move from the 1.2099 swing low to the 1.2523 high. Any more losses could send the pair toward the 1.2200 level.
On the upside, the pair seems to be facing hurdles near the 1.2500 level. There is also a connecting bearish trend line forming with resistance at 1.2500 on the same chart.
The next major resistance is near the 1.2550 level. A close above the 1.2550 level could set the tone for another increase. In the stated case, the pair could even clear the 1.2620 resistance.
Looking at EUR/USD, the pair failed to gain pace above 1.0500 and recently started a downside correction.
Upcoming Economic Events:
- Fed Interest Rate Decision – Forecast 4.5%, versus 4.5% previous.
- BoC Interest Rate Decision – Forecast 3.0%, versus 3.25% previous.
