GBP/USD started a strong decline from well above the 1.2750 level and it broke the 1.2550 support. Conversely, USD/CAD climbed towards 1.3680 and it is currently consolidating gains.
Important Takeaways for GBP/USD and USD/CAD
- The British Pound traded below the 1.2650 and 1.2550 support levels.
- There are two key bearish trend lines forming with resistance near 1.2470 and 1.2510 on the hourly chart of GBP/USD.
- USD/CAD settled nicely in the green zone above the 1.3500 resistance level.
- There is an ascending channel forming with support near 1.3570 on the hourly chart.
GBP/USD Technical Analysis
In the past few days, the British Pound followed a bearish path from well above 1.2750 against the US Dollar. The GBP/USD pair broke many important supports such as 1.2650 and 1.2550 to enter a bearish zone.
The pair even broke the 1.2420 support level and settled below the 50 hourly simple moving average. A new weekly low is formed near the 1.2335 level on FXOpen and the pair is currently correcting higher.
An initial resistance on the upside is near the 1.2400 and 1.2420 levels. The 23.6% Fib retracement level of the downward move from the 1.2687 high to 1.2335 low is also near 1.2420 along with the 50 hourly simple moving average.
More importantly, there are two key bearish trend lines forming with resistance near 1.2470 and 1.2510 on the hourly chart of GBP/USD. The second trend line is close to the 50% Fib retracement level of the downward move from the 1.2687 high to 1.2335 low.
Therefore, the pair is likely to face a lot of hurdles on the upside, starting with 1.2420 and up to 1.2510 in the near term. On the downside, an initial support is seen near the 1.2330 and 1.2320 levels.
If GBP/USD fails to start a decent recovery wave above the 1.2420 resistance, it is likely to break the 1.2300 level and continue lower in the coming sessions.
USD/CAD Technical Analysis
The US Dollar traded with a positive bias above the 1.3400 pivot level against the Canadian Dollar. The USD/CAD pair traded above the 1.3500 resistance zone to move into a bullish zone.
The pair gained pace above the 1.3550 level and the 50 hourly simple moving average. It traded as high as 1.3685 before starting a downside correction. There was a break below the 1.3520 level, but the 1.3500 region acted as a support.
A low was formed near 1.3504 and the pair is currently consolidating gains. There was a decent recovery wave above the 50% Fib retracement level of the downward move from the 1.3685 high to 1.3504 low.
It seems like there is an ascending channel forming with support near 1.3570 on the hourly chart. On the upside, the pair is facing a strong resistance near the 1.3620 level. A successful break above the 1.3620 resistance and a follow through above 1.3650 might open the doors for a fresh increase.
The next key resistance is near the 1.3700 and 1.3720 levels. Conversely, USD/CAD might break the channel support and decline towards the 1.3500 support. Any further losses might push the pair into a short term bearish zone and it could decline towards the 1.3400 pivot level.
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.