Key Take-Aways
- GBP/USD fell below 1.1950 after failing to correct upward.
- On the 4-hours chart, a significant negative trend line is developing with resistance close to 1.2050.
- EUR/USD continued to fall and traded under the 1.0110 level of support.
- Above 137.50, USD/JPY surged to a new multi-year high.
Technical Analysis of GBP/USD
Against the US Dollar, the British Pound was unable to rise over the 1.2050 level. Below 1.2000, the GBP/USD currency pair started a new slide and entered a negative zone.
The pair increased in momentum below the 1.1980 level, the 100 simple moving average, when looking at the 4-hour chart (red, 4-hours). It is also significantly higher than the 200 simple moving average (green, 4-hours).
Even yet, the pair surged below the 1.1875 swing low. The pair may decline towards the 1.1820 level if the bears continue to exert pressure. Near the 1.1750 mark, there is the next significant support. The pair may drop much more if the downside broke through the 1.1750 support level.
The pair is running into resistance in the 1.2000 area on the upside. On the same chart, a significant negative trend line with resistance close to 1.2050 is also developing.
A test of the 1.2050 resistance level may be necessary if there is a clear advance above the trend line. Any further gains might pave the way for a move in the direction of the 1.2180 resistance.
When looking at EUR/USD, the pair began a new fall after failing to rise over the 1.0120 mark. The bears appear to be aiming for a move under 1.0000.
Economic Release to Trade Today
- German ZEW Business Economic Sentiment Index for July 2022 is expected to be -38, down from -28 in the previous month.
- The forecast for the July 2022 Eurozone ZEW Business Economic Sentiment Index is -32.8, up from the previous reading of -27.6.
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