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GBP/USD Rebound Could Fail Near 1.2150 or 1.2200

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Aayush Jindal

Key Highlights

  • The British Pound recovered from a new 2-yearlow at 1.2014 against the US Dollar.
  • GBP/USD is likely to face a strong sellinginterest near 1.2150 or 1.2200.
  • The UK Claimant count could change 22.8K in July2019, less than the last 38.0K.
  • EUR/USD remained well bid and supported abovethe 1.1150 area.

GBP/USD Technical Analysis

In the past few days, the British Pound declined heavily below 1.2250 and 1.2150 supports against the US Dollar. The GBP/USD pair even traded to a new 2-year low at 1.2014 and recently started an upside correction.

GBP/USD Technical Analysis British Pound US Dollar

Looking at the 4-hours chart, the pair is trading well belowthe 1.2250 pivot level and the 100 simple moving average (red, 4-hours). Itcorrected above the 1.2050 level plus the 38.2% Fib retracement level of the downwardmove from the 1.2209 high to 1.2014 low.

However, the pair is facing a lot of hurdles on the upsidenear the 1.2120 and 1.2150 levels. Moreover, there is a declining channelforming with resistance near 1.2135 on the same chart.

Above the channel resistance, the next key resistance isnear the 1.2200 area. The main resistance for a strong recovery is near 1.2250,100 SMA, and the 1.236 Fib extension level of the downward move from the 1.2209high to 1.2014 low.

If GBP/USD fails to correct above 1.2150 or 1.2200, it couldresume it slide. An immediate support is near the 1.2040 level. The mainsupport is near 1.2000, below which there is a risk of heavy downsides in thecoming days.

Looking at EUR/USD, the pair remained well supported above the key 1.1150 support level. Gold price is also trading in a positive zone above the $1,480 and $1,482 support levels. On the other hand, USD/JPY extended losses and broke the key 105.50 support area.

Economic Releases to Watch Today

  • German Consumer Price Index July 2019 (YoY) – Forecast +1.7%, versus +1.7% previous.
  • German Consumer Price Index July 2019 (MoM) – Forecast +0.5%, versus +0.5% previous.
  • UK Claimant Count Change July 2019 – Forecast 22.8K, versus 38.0K previous.
  • UK ILO Unemployment Rate June 2019 (3M) – Forecast 3.8%, versus 3.8% previous.
  • US Consumer Price Index July 2019 (MoM) – Forecast +0.3%, versus +0.1% previous.
  • US Consumer Price Index July 2019 (YoY) – Forecast +1.7%, versus +1.6% previous.
  • US CPI Ex Food & Energy July 2019 (YoY) – Forecast +2.1%, versus +2.1% previous.
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