Key Highlights
- GBP/USD surged above the 1.3000 and 1.3100 resistance levels.
- A crucial bearish trend line was breached with resistance near 1.2965 on the 4-hours chart.
- EUR/USD is gaining bullish momentum and it could even surpass 1.1500.
- The NFIB Business Optimism Index could increase from 104.3 to 104.5 in Feb 2020.
GBP/USD Technical Analysis
The British Pound formed a strong base above 1.2750 and started a significant upward move against the US Dollar. GBP/USD broke the key 1.3000 resistance area to move into a positive zone.
Looking at the 4-hours chart, the pair even gained pace above the 1.3120 resistance area, plus it settled well above both the 100 simple moving average (red, 4-hours) and the 200 simple moving average (green, 4-hours).
It traded close to the 1.3200 level and a high was formed near 1.3199. Recently, there was a downside correction below the 23.6% Fib retracement level of the upward move from the 1.2725 low to 1.3199 high.
However, there are many supports on the downside, starting with 1.3020. The next support is near the 50% Fib retracement level of the upward move from the 1.2725 low to 1.3199 high at 1.2962.
The main support area is now near the 1.2920 level and the 100 simple moving average (red, 4-hours). On the upside, the 1.3200 and 1.3220 levels are initial hurdles for the bulls.
If GBP/USD gains strength above the 1.3220 level, there are chances of a steady rise towards the 1.3280 and 1.3320 levels in the near term.
Similarly, there were positive moves in EUR/USD above the 1.1320 and 1.1300 support levels. The highlight was a huge drop in crude oil price below the $40.00 support area.
Upcoming Economic Releases
- Euro Zone Gross Domestic Product Q4 2019 (QoQ) – Forecast 0.1%, versus 0.1% previous.
- Euro Zone Gross Domestic Product Q4 2019 (YoY) – Forecast 0.9%, versus 0.9% previous.
- US NFIB Business Optimism Index Feb 2020 – Forecast 104.5, versus 104.3 previous.
