GBP/USD Nosedives, USD/CAD Starts Major Increase

Aayush Jindal -

GBP/USD started a sharp downward move after it failed to clear 1.4200. USD/CAD is surging and it recently cleared the 1.2440 resistance zone.

Important Takeaways for GBP/USD and USD/CAD

  • The British Pound started a fresh decline from well above the 1.4100 level.
  • There is a key bearish trend line forming with resistance near 1.3850 on the hourly chart of GBP/USD.
  • USD/CAD gained bullish momentum above the 1.2350 and 1.2400 resistance levels.
  • There is a major bullish trend line forming with support near 1.2410 on the hourly chart.

GBP/USD Technical Analysis

The British Pound made a couple of attempts to settle above 1.4150 and clear 1.4200 against the US Dollar. However, the GBP/USD pair failed to continue higher, and it started a fresh decline from well above the 1.4100 level.

The pair gained bearish momentum below the key 1.4000 support zone. There was a clear break below the 1.3920 support level and the 50 hourly simple moving average. The pair even broke the 1.3840 support and traded as low as 1.3790 on FXOpen.

Th pair is now consolidating losses above the 1.3800 level. An initial resistance on the upside is near the 1.3840 level. There is also a key bearish trend line forming with resistance near 1.3850 on the hourly chart of GBP/USD.

The next hurdle is near the 23.6% Fib retracement level of the downward move from the 1.4132 swing high to 1.3790 low. The main hurdle is near the 1.3900 level and the 50 hourly simple moving average.

Any more gains could lead the pair towards the 50% Fib retracement level of the downward move from the 1.4132 swing high to 1.3790 low. An initial support on the downside is near the 1.3800 level. The first major support is near the 1.3780 level.

Any more losses could open the doors for a move towards the 1.3720 support zone. The next major support sits near the 1.3650 level.

USD/CAD Technical Analysis

The US Dollar formed a strong support base above the 1.2000 and 1.2050 levels against the Canadian Dollar. The USD/CAD pair started a major increase and it broke the 1.2200 resistance zone.

The pair gained pace for a move above the 1.2350 level and the 50 hourly simple moving average. Finally, there was a break above the 1.2450 level and the pair traded as high as 1.2480.

It is now consolidating gains above the 1.2440 level. An initial support on the downside is near the 1.2420 level. There is also a major bullish trend line forming with support near 1.2410 on the hourly chart.

The trend line is also near the 23.6% Fib retracement level of the upward move from the 1.2156 low to 1.2480 high. A downside break below the trend line could lead the price towards the 1.2350 support or the 50 hourly simple moving average.

The next major support could be the 1.2320 level. It is close to the 50% Fib retracement level of the upward move from the 1.2156 low to 1.2480 high.

On the upside, the first major resistance is near the 1.2480 level. The next major resistance is near the 1.2500 level. A clear break above the 1.2500 level could possibly lead the pair towards the 1.2620 zone in the near term.

This forecast represents FXOpen Markets Limited opinion only, it should not be construed as an offer, invitation or recommendation in respect to FXOpen Markets Limited products and services or as financial advice.