GBP/USD climbed higher recently and settled above the 1.3000 resistance area. On the other hand, EUR/GBP declined sharply and it is could continue to move down towards 0.8650.
Important Takeaways for GBP/USD and EUR/GBP
- The British Pound gained pace recently and broke the 1.2940 and 1.3000 resistance levels.
- There is a crucial breakout pattern formed with resistance at 1.3080 on the hourly chart of GBP/USD.
- EUR/GBP declined heavily and broke the key 0.8750 support area.
- There is a major bearish trend line formed with resistance at 0.8715 on the hourly chart.
GBP/USD Technical Analysis
The British Pound found a strong buying interest near the 1.2780 and 1.2800 levels against the US Dollar. The GBP/USD pair started a strong upward move and broke the 1.2850, 1.2940 and 1.3000 resistance levels.
The upward move was strong as the pair even broke the 1.3050 resistance and the 50 hourly simple moving average. A new weekly high was formed at 1.3108 on FXOpen and later the pair started a downside correction.
It traded below the 1.3050 and 1.3000 support levels to move into a short term bearish zone. It even broke the 50% fib retracement level of the last wave from the 1.2895 low to 1.3108 high.
However, the decline was protected by the 1.2980 support area and the 61.8% fib retracement level of the last wave from the 1.2895 low to 1.3108 high. The pair bounced back above 1.3020 and settled above the 50 hourly SMA.
At the outset, it seems like there is a crucial breakout pattern formed with resistance at 1.3080 on the hourly chart of GBP/USD. The pair could gain bullish momentum once it breaks the 1.3080 and 1.3100 resistance levels.
The next key stop for buyers could be 1.3120, above which the pair could rally towards the 1.3160 level. On the downside, an initial support is near the 1.3040 level, below which the pair could revisit the 1.3000 support area in the near term.
EUR/GBP Technical Analysis
The Euro started a major downside move from well above the 0.8800 level against the British Pound. The EUR/GBP pair traded sharply lower and broke the 0.8750 and 0.8720 support levels.
It even broke the 0.8700 support and the 50 hourly simple moving average. A low was formed at 0.8664 and later the pair started corrected higher. It is currently consolidating losses near the 23.6% Fib retracement level of the recent decline from the 0.8728 high to 0.8664 low.
On the upside, an initial resistance is near the 0.8695 level and the 50 hourly simple moving average. The next key resistance is 0.8700 and the 50% Fib retracement level of the recent decline from the 0.8728 high to 0.8664 low.
More importantly, there is a major bearish trend line formed with resistance at 0.8715 on the hourly chart. Therefore, the pair needs to climb above the 0.8700 and 0.8715 levels to move into a positive zone.
If it continues to struggle below 0.8715, there are chances of more losses in the near term. A break below the recent low of 0.8664 could accelerate losses in EUR/GBP towards the 0.8650 or 0.8640 support level. The main support is near 0.8620, where buyers may emerge.
Trade global forex with the Innovative Broker of 2022*. Choose from 50+ forex markets 24/5. Open your FXOpen account now or learn more about making your money go further with FXOpen.
* FXOpen International, Innovative Broker of 2022, according to the IAFT
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.