Key Highlights
- GBP/USD corrected lower from the 1.2450 zone.
- It traded below a major bullish trend line with support at 1.2330 on the 4-hours chart.
- EUR/USD corrected lower and tested the 1.0580 zone.
- Gold price could attempt a fresh increase if it stays above the $1,780 zone.
GBP/USD Technical Analysis
The British Pound started a downside correction from the 1.2450 zone against the US Dollar. GBP/USD declined below the 1.2300 and 1.2250 support levels.
Looking at the 4-hours chart, the pair even traded below the 1.2200 level to move into a short-term bearish zone. During the decline, there was a break below a major bullish trend line with support at 1.2330.
There was a close below the 1.2200 level and the 100 simple moving average (red, 4-hours). The pair tested the 1.2000 support zone and 200 simple moving average (green, 4-hours).
On the downside, there is a major support at 1.2000. A downside break below the 1.2000 zone might spark a major decline. Any more losses might open the doors for a move towards the 1.1850 support zone.
On the upside, an initial resistance is near the 1.2100 level. The next major resistance may perhaps be near 1.2200. A clear move above the 1.2200 resistance might start a steady increase.
In the stated case, GBP/USD may perhaps rise towards the 1.2280 level. Any more gains could lead the pair towards the 1.23200 resistance zone or the 1.2400 level.
Looking at gold price, the bulls seem to be active above the $1,780 level and they might attempt a fresh increase in the near term.
Economic Releases
- Dallas Fed Manufacturing Business Index for Dec 2022 – Forecast -15.0, versus -14.4 previous.
- S&P/Case-Shiller Home Price Indices for Oct 2022 (YoY) – Forecast +9.7%, versus +10.4% previous.
