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GBP/USD Correcting Gains, Gold Surpasses $1,850

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Aayush Jindal

Key Highlights

  • GBP/USD started a downside correction from the 1.3540 resistance zone.
  • There was a break below a major bullish trend line at 1.3340 on the 4-hours chart.
  • EUR/USD remained well bid above 1.2100 and started a fresh increase.
  • Gold price broke the key resistance near $1,850 and gained bullish momentum.

GBP/USD Technical Analysis

In the past few days, there was a steady rise in the British Pound above 1.3320 resistance against the US Dollar. GBP/USD even broke the key 1.3400 resistance area and climbed above 1.3500 before facing hurdles.

Looking at the 4-hours chart, the pair traded as high as 1.3538 and it settled well above the 200 simple moving average (green, 4-hours). Recently, there was a downside correction below the 1.3500 and 1.3440 support levels.

There was even a break below a major bullish trend line with support at 1.3340 on the same chart. The pair spiked below 1.3300 and the 100 simple moving average (red, 4-hours). The pair traded as low as 1.3225 and it remains at a risk of more losses.

The next major support is near the 1.3180 level, below which the pair could test 1.3120. Conversely, the pair could start a fresh increase above the 1.3380 and 1.3400 resistance levels. The next major resistance at 1.3440 and 1.3445.

Looking at EUR/USD, the pair climbed higher nicely after retesting the 1.2080 support area. More importantly, gold price started a strong rise above the $1,850 resistance zone.

Upcoming Economic Releases

  • Euro Zone Gross Domestic Product Q3 2020 (QoQ) - Forecast 12.6%, versus 12.6% previous.
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  • German ZEW Business Economic Sentiment Index for Dec 2020 – Forecast 46, versus 39 previous.
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