GBP/USD Targets New Highs, US Dollar Decline
- GBP/USD is maintaining gains over the 1.2000 support level.
- On the 4-hours chart, it is trading above a significant bullish trend line with support located close to 1.1960.
- The price of crude oil fell sharply and tested the $74.20 support level.
- The EUR/USD pair started to rise again and went above 1.0400.
Technical Analysis of GBP/USD
In relation to the US Dollar, the British Pound began a new uptrend over the resistance at 1.1800. Even more, GBP/USD broke through the 1.2000 resistance to enter the positive territory.
The 100 simple moving average (red, 4-hours) and the 200 simple moving average were both above the 1.2000 mark on the 4-hours chart (green, 4-hours).
Before there was a brief downward correction, it traded to a new multi-week high of 1.2153. The 1.2000 level serves as a temporary support. Near the 1.1960 zone is the next significant support. On the same chart, a significant bullish trend line with support close to 1.1960 is also developing.
Any further losses might push the pair in the direction of the 1.1850 support area. On the plus side, if the pair settles above the 1.2150 mark, it might start to trend upward.
In the aforementioned scenario, GBP/USD may perhaps challenge the barrier at 1.2250. The area around 1.2380 might serve as the next significant resistance. Any further gains might pave the stage for a move in the direction of the 1.2500 resistance region.
Looking at the EUR/USD pair, it is still well bid above the 1.1300 level and may move higher towards the 1.1500 resistance area.
Economic News To Trade Today
- German Consumer Price Index for November 2022 (YoY) (Prelim): Forecast +10.3%, up from +10.4% in the prior month.
- US Housing Price Index for September 2022 (MoM): Forecast -0.7%, down from -0.7% in the prior month.
- Canadian GDP for Q3 2022 (annualized) is expected to increase by 3.5% compared to the previous quarter.
Author: Amogo Solomon
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