Key Highlights
- GBP/USD started a downside correction from the 1.2550 zone.
- It traded below a major bullish trend line with support near 1.2410 on the 4-hour chart.
- EUR/USD also dipped and might test the 1.0880 support.
- The UK Claimant count could change -11.8K in March 2023.
GBP/USD Technical Analysis
The British Pound gained pace above the 1.2420 resistance against the US Dollar. GBP/USD climbed above the 1.2500 level before the bears appeared.
Looking at the 4-hour chart, the pair traded as high as 1.2546. Recently, it started a downside correction below the 1.2500 level. There was a move below a major bullish trend line with support near 1.2410.
The pair declined below the 61.8% Fib retracement level of the upward move from the 1.2344 swing low to the 1.2546 high. Finally, it tested the 1.2380 support and the 100 simple moving average (red, 4 hours).
The next support could be at 1.2300 or the 1.236 Fib extension level of the upward move from the 1.2344 swing low to the 1.2546 high. Any more losses might send GBP/USD toward the 1.2220 support or the 200 simple moving average (green, 4 hours)/
On the upside, the pair is facing resistance near the 1.2420 level. The next key resistance is near the 1.2450 zone. A clear move above the 1.2450 resistance might send the pair toward the 1.2500 zone. Any more gains might send the pair toward 1.2550.
Looking at EUR/USD, the pair corrected lower below 1.0950 and there is a risk of a move toward the 1.0880 support.
Economic Releases
- UK Claimant Count Change for March 2023 – Forecast -11.8K, versus -11.2K previous.
- UK ILO Unemployment Rate for Feb 2023 (3M) – Forecast 3.7%, versus 3.7% previous.
- Canadian Consumer Price Index for March 2023 (MoM) – Forecast +0.5%, versus +0.4% previous.
- Canadian Consumer Price Index for March 2023 (YoY) – Forecast +4.3%, versus +5.2% previous.
