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GBP/USD Continues To Struggle Below 1.4200

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Aayush Jindal

Key Highlights

  • GBP/USD is facing a major resistance near 1.4200 and 1.4220.
  • Crucial supports are forming near 1.4080 and 1.4050 on the 4-hours chart.
  • EUR/USD’s recovery could face hurdles near 1.2170 and 1.2200.
  • The UK’s ILO Unemployment rate is likely to decline from 4.8% to 4.7% in April 2021 (3M).

GBP/USD Technical Analysis

The British made a couple of attempts to gain strength above 1.4200 against the US Dollar. However, GBP/USD failed to continue higher and moved lower.

Looking at the 4-hours chart, the pair seems to be following a declining pattern from the 1.4250 high. It started moving in a range below the 1.4200 and 1.4220 resistance levels.

There was a break below the 1.4150 support level and the 100 simple moving average (red, 4-hours). The pair even tested the 1.4080 support and the 200 simple moving average (green, 4-hours).

On the upside, an immediate resistance is near the 1.4140 level. The first major resistance is near the 1.4150 level and the 100 SMA. The main resistance is still near the 1.4200 level. A close above 1.4200 could set the pace for a larger increase.

On the downside, the 1.4080 level is a decent support. If there are more losses, the pair could test the 1.4000 support. The next key support is near the 1.3920 level.

Besides, EUR/USD is attempting a recovery wave, but it is likely to face sellers near 1.2150, 1.2170, and 1.2200 in the near term

Economic Releases

  • German Consumer Price Index for May 2021 (YoY) – Forecast +2.5%, versus +2.5% previous.
  • German Consumer Price Index for May 2021 (MoM) – Forecast +0.5%, versus +0.5% previous.
  • UK Claimant Count Change for May 2021 – Forecast -2K, versus -15.1K previous.
  • UK ILO Unemployment Rate for April 2021 (3M) – Forecast 4.7%, versus 4.8% previous.
  • US Retail Sales for May 2021 (MoM) – Forecast -0.8%, versus 0% previous.
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