Key Highlights
- GBP/USD faced rejection near 1.2700 and declined heavily.
- A major bearish trend line is forming with resistance at 1.2670 on the 4-hour chart.
- EUR/USD is also trading in a bearish zone below 1.0700.
- The US Gross Domestic Product could grow by 1.3% in Q1 2024.
GBP/USD Technical Analysis
The British Pound failed to recover above the 1.2700 resistance against the US Dollar. GBP/USD started another decline and traded below the 1.2665 support.
Looking at the 4-hour chart, the pair settled below the 1.2665 level, the 100 simple moving average (red, 4-hour), and the 200 simple moving average (green, 4-hour). It seems like the bears are aiming for a move below the 1.2600 support.
On the upside, the pair is facing resistance near the 1.2655 level. The next resistance sits at 1.2670. There is also a major bearish trend line forming with resistance at 1.2670 on the same chart.
The first major resistance is near the 1.2700 level and the 200 simple moving average (green, 4-hour). A clear move above the 1.2700 resistance might send it toward the 1.2725 level and the 100 simple moving average (red, 4-hour).
The main resistance is now near 1.2780. Any more gains might call for a move toward the 1.2850 level in the near term. If not, the pair might continue to move down.
Immediate support is near the 1.2600 level. The next major support is near the 1.2565 zone. A downside break and close below the 1.2565 support zone could open the doors for a larger decline. In the stated case, the pair could decline toward the 1.2420 level.
Looking at EUR/USD, the pair gained bearish momentum below the 1.0720 level and there are chances of more downsides below 1.0675.
Economic Releases
- US Initial Jobless Claims – Forecast 236K, versus 238K previous.
- US Durable Goods Orders for May 2024 – Forecast 0% versus +0.6% previous.
- US Gross Domestic Product for Q1 2024 – Forecast 1.3% versus previous 1.3%.
