Key Highlights
- GBP/USD started a downside correction from 1.3830.
- It traded below a key bullish trend line with support near 1.3750 on the 4-hours chart.
- EUR/USD is still trading above the 1.1525 support zone.
- The US ISM Manufacturing Index declined from 61.1 to 60.8 in Oct 2021.
GBP/USD Technical Analysis
The British Pound struggled to stay above 1.3800 against the US Dollar. GBP/USD formed a high near 1.3830 and started a downside correction.
Looking at the 4-hours chart, the pair corrected lower below the 1.3800 and 1.3780 support levels. The pair traded below the 23.6% Fib retracement level of the upward move from the 1.3414 swing low to 1.3833 high.
There was also a break below 1.3750 and the 100 simple moving average (red, 4-hours). It tested the 1.3650 support zone and the 200 simple moving average (green, 4-hours).
On the downside, an initial support is near 1.3650 level. The next major support is near 1.3620. It is near the 50% Fib retracement level of the upward move from the 1.3414 swing low to 1.3833 high.
A close below the 1.3620 level might push the pair towards the 1.3570 support. On the upside, an immediate resistance is near the 1.3720 level and the 100 SMA. The next major resistance is near the 1.3750 level, above which the pair might rise towards the 1.3800 level. The main resistance still stands near 1.3830.
Looking at EUR/USD, the pair stayed above the 1.1525 support, but it is facing a lot hurdles on the upside near 1.1620 and 1.1650.
Economic Releases
- Germany’s Manufacturing PMI for Oct 2021 – Forecast 58.2, versus 58.2 previous.
- Euro Zone Manufacturing PMI for Oct 2021 – Forecast 58.5, versus 58.5 previous.
