Market Analysis: GBP/USD Regains Strength, USD/CAD Corrects Lower

GBP/USD started a strong increase and retested 1.2850. USD/CAD is correcting gains and trading below the 1.3300 support.

Important Takeaways for GBP/USD and USD/CAD Analysis Today

· The British Pound started a steady increase above the 1.2760 resistance.

· There was a break above a connecting trend line with resistance near 1.2780 on the hourly chart of GBP/USD at FXOpen.

· USD/CAD declined below the 1.3320 and 1.3300 support levels.

· It traded below a key bullish trend line with support at 1.3320 on the hourly chart at FXOpen.

GBP/USD Technical Analysis

On the hourly chart of GBP/USD at FXOpen, the pair was able to climb above the 1.2720 resistance zone. The British Pound gained strength after it broke the 50-hour simple moving average at 1.2760.

During the increase, there was a break above a connecting trend line with resistance near 1.2780. It opened the doors for a move toward the 1.2850 resistance where the bears emerged. A high is formed near 1.2849 and the pair is now consolidating gains.

The RSI dipped below the 60 level on the GBP/USD chart and the pair is now testing the 23.6% Fib retracement level of the upward move from the 1.2673 swing low to the 1.2849 high.

Immediate resistance is forming near the 1.2850 level. The next resistance is near 1.2880. An upside break above the 1.2880 zone could send the pair toward 1.2950. Any more gains might open the doors for a test of 1.3000.

On the downside, initial support is near the 1.2805 area. The next major support is near the 50% Fib retracement level of the upward move from the 1.2673 swing low to the 1.2849 high at 1.2760 and the 50-hour simple moving average.

If there is a break below 1.2760, the pair could extend its decline. The next key support is near the 1.2720 level. Any more losses might call for a test of the 1.2650 support.

USD/CAD Technical Analysis

On the hourly chart of USD/CAD at FXOpen, the pair started a fresh decline from the 1.3385 resistance zone. The US Dollar gained bearish momentum below the 1.3360 support against the Canadian Dollar.

The pair traded below a key bullish trend line with support at 1.3320. The bears were able to push the pair below the 50% Fib retracement level of the upward move from the 1.3313 swing low to the 1.3386 high.

It is now trading well below the 50-hour simple moving average on the USD/CAD chart. Immediate support is near the 76.4% Fib retracement level of the upward move from the 1.3313 swing low to the 1.3386 high at 1.3255.

A close below the 1.3255 level might trigger a strong decline. In the stated case, USD/CAD might test 1.3200. Any more losses may possibly open the doors for a drop toward the 1.3150 support.

On the upside, the pair is facing resistance near 1.3300. The first major resistance is near the 50-hour simple moving average at 1.3320. If there is an upside break above 1.3320, the pair could rise toward the 1.3360 resistance.

The next major resistance is near the 1.3385 level, above which it could rise steadily toward the 1.3450 resistance zone.