Key Take-Aways
- Over 1.1950, GBP/USD began an upward correction.
- On the 4-hour chart, it broke over a significant negative trend line with resistance close to 1.1880.
- If EUR/USD overcomes the 1.0240 resistance, it might pick up speed.
- The price of gold is fighting to rise by over $1,740.
Technical Analysis of GBP/USD
The British pounds began a significant drop against the US Dollar from far over the 1.2200 region. GBP/USD even hit the 1.1760 region after breaking through the 1.2000 support.
On the 4-hour chart, the pair’s lowest price was 1.1759. It settled significantly below the 200 simple moving average and the 100 simple moving average (red, 4 hours) (green, 4 hours).
Over the recent period, there was an upward correction over the resistance level of 1.1850. On the same chart, a significant negative trend line with resistance close to 1.1880 was clearly crossed. Additionally, the price of the pair increased above the 38.2% Fibonacci retracement level of the decline from the swing high of 1.2332 to the low of 1.1759.
Currently, resistance is present close to either the 1.2040 level or the 100 simple moving average (red, 4 hours). It is quite near to where the downward movement from the 1.2332 swing high to the 1.1759 low is retraced 50% by the Fibonacci method.
The pair could correct lower and sink below 1.1950 if there is no upside break. Below 1.1850, the pair may resume its downward trend, which would be the next significant support.
Regarding EUR/USD, the pair also began an upward reversal above the parity level but may encounter obstacles close to the 1.0240 region.
Economic News to Trade Today
- UK claimant count change for June 2022 is predicted to be -5.0K, down from -19.7K in the past.
- ILO forecasts a 3.8 percent unemployment rate for the UK in May 2022 (3M), down from the previous 3.8 percent.
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