GBP/USD is Integrating, Upside Gain is Constrained

Key Take-Aways

  • GBP/USD reversed losses from the 1.2000 level of support.
  • On the 4-hour chart, a significant negative trend line is developing with resistance close to 1.2190.
  • A significant resistance for EUR/USD is located close around 1.0520.
  • In June 2022, the UK Services PMI may hold steady at 53.4.

GBP/USD Technical Analysis

The 1.2400 resistance area of the GBP/USD marked the beginning of a new slide for the British pound. The GBP/USD exchange rate dropped below the 1.2200 support level and entered a negative zone.

The pair has consolidated below the 1.2150 level, the 100 simple moving average (4-hours, red), and the 200 simple moving average, according to the 4-hours chart (green, 4-hours).

It further traded and even soared below 1.2000. Near 1.1977, a low was created, and the pair recently erased a few losses. The 1.2020 and 1.2050 levels were crossed to the upside.

The price of the pair increased over the 23.6 percent Fibonacci retracement level of the declining move from the 1.2406 swings high to 1.1977 swings low. The pair is running into resistance in the 1.2200 area on the upside. On the same chart, a significant bearish trend line with resistance close to 1.2190 is also developing.

The downward movement from the 1.2406 swing high to the 1.1977 low is near the 50% Fib retracement level. A rebound wave might begin with closing above the trend line, the 100 simple moving average (red, 4 hours), and the 1.2200 zone.

Otherwise, GBP/USD may begin a new drop below 1.2100. The 1.2050 support level is good support on the downside. Near the 1.2000 level, there is significant support. The pair could drop even further if the downward breach occurs below the 1.2000 support. Below this level, the bears may go for 1.1800 as the next significant support.

For EUR/USD, the pair comes up against a significant barrier close to 1.0520. If there is no upside break, the pair can begin another declining move towards the 1.0365 mark.

Today’s Economic Releases

German services PMI for June 2022 is forecasted at 52.4, against the 52.4 previous months.

The Euro Zone Services PMI in June 2022 Is forecasted at 52.8, against the 52.8 previous

UK Services PMI for June 2022 is forecasted to be 53.4, against the 53.4 previous.