GBP/USD started a decent recovery and climbed above the 1.3020 resistance area. EUR/GBP declined heavily below 0.8400 and it could continue to move down towards 0.8250.
Important Takeaways for GBP/USD and EUR/GBP
- The British Pound started an upward move from the 1.2880 support area.
- There is a key bullish trend line forming with support near 1.3020 on the hourly chart of GBP/USD.
- EUR/GBP declined heavily after it failed to clear the 0.8500 resistance area.
- There is a major bearish trend line forming with resistance near 0.8330 on the hourly chart.
GBP/USD Technical Analysis
After a steady decline, the British Pound found support near 1.2900 and 1.2880 against the US Dollar. As a result, the GBP/USD pair started an upward move above the 1.2950 and 1.3000 resistance levels.
The upward move was such that the pair even climbed above the 1.3020 area and the 50 hourly simple moving average. Finally, it climbed above the 1.3050 level and traded as high as 1.3069 on FXOpen.
It is currently correcting lower below the 1.3050 and 1.3040 levels. There was a break below the 38.2% Fib retracement level of the upward move from the 1.2943 low to 1.3069 high.
However, the pair remained well bid above the 1.3000 area and the 50 hourly simple moving average. Besides, there is a key bullish trend line forming with support near 1.3020 on the hourly chart of GBP/USD.
The 50% Fib retracement level of the upward move from the 1.2943 low to 1.3069 high also acted as a strong support. The pair is currently rising and trading near the 1.3050 resistance.
On the upside, the pair must clear the 1.3050 resistance and connecting bearish trend line on the same chart. If there is a proper close above the 1.3050 resistance area, GBP/USD could continue to rise towards 1.3100 and 1.3120.
Conversely, there is a risk of a downside correction towards the 1.2950 support area in the coming sessions.
EUR/GBP Technical Analysis
The Euro failed to clear the 0.8500 resistance area against the British Pound. As a result, the EUR/GBP pair started a strong decline below the 0.8400 support area.
The pair even tumbled below the 0.8350 support area and the 50 hourly simple moving average. The decline was such that the pair dived towards the 0.8300 area.
A swing low is formed near 0.8294 and the pair is currently consolidating losses. It recovered a few points above the 0.8310 level. Besides, it surpassed the 23.6% Fib retracement level of the recent decline from the 0.8398 high to 0.8294 low.
However, the pair struggled to recover above the 0.8340 area and the 50 hourly simple moving average. More importantly, there is a major bearish trend line forming with resistance near 0.8330 on the hourly chart.
The pair also failed to clear the 50% Fib retracement level of the recent decline from the 0.8398 high to 0.8294 low. It is currently showing a few bearish signs below the 0.8320 level.
Therefore, there is a risk of more losses below the 0.8300 and 0.8280 support levels in the near term. Conversely, the EUR/GBP pair must recover above the 0.8320 and 0.8340 levels to start a strong recovery wave in the near term.