Key Highlights
- GBP/USD started an upside correction above the 1.1000 level.
- It broke a major bearish trend line at 1.1030 on the 4-hours chart.
- EUR/USD is facing a couple of key hurdles near the 0.9850 level.
- The US ISM Manufacturing PMI declined from 52.8 to 50.9 in Sep 2022.
GBP/USD Technical Analysis
The British Pound traded to a new low at 1.0340 against the US Dollar. GBP/USD formed a base above 1.0350 and started a decent recovery wave.
Looking at the 4-hours chart, the pair was able to climb above the 1.0800 and 1.1000 resistance levels. There was a move above the 50% Fib retracement level of the downward move from the 1.1738 swing high to 1.0340 low.
Besides, there was a break above a major bearish trend line at 1.1030 on the same chart. The pair tested the 1.1250 resistance zone and the 100 simple moving average (red, 4-hours).
The 61.8% Fib retracement level of the downward move from the 1.1738 swing high to 1.0340 low acted as a resistance. The first major resistance is near 1.1250 level, above which the pair may perhaps rise towards the 1.1400 resistance.
A clear move above the 0.9900 level might send the pair towards the 1.1500 level or at least the 200 simple moving average (green, 4-hours).
On the downside, an initial support is near the 1.0980 level. The main support sits at the 1.0900 level. A downside break below the 1.0900 zone might send the pair towards the 1.0800 level. The next major support is near the 1.0720 level, below which the pair could even test the 1.0600 support zone.
Looking at EUR/USD, the pair is facing a major resistance near the 0.9850 level and remains at a risk of a fresh decline in the near term.
Economic Releases
- US Factory Orders for August 2022 (MoM) – Forecast +0.3%, versus -1% previous.
