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GBP/USD Could Struggle As US Dollar Regains Strength

Key Highlights

  • GBP/USD is signaling more downsides below 1.2050.
  • Gold prices struggled to continue higher above the $1,935 resistance.
  • Bitcoin price saw wild moves after fake news of spot ETF approval.
  • Israeli strikes on Gaza intensify as crisis deepens.

 

GBP/USD Technical Analysis

The British Pound started another decline from the 1.2340 resistance against the US dollar. GBP/USD declined below 1.2200 and remains at a risk of a drop to 1.2000. It seems like the Israeli-Hamas crisis deepened as strikes on Gaza intensified amid reports of over 195 people being abducted by Hamas.

Looking at the 4-hour chart of GBP/USD, the pair declined below the 1.2250 support zone. There was a break below a key bullish trend line with support near 1.2210. The pair even settled below the 1.2200 level, the 100 simple moving average (red, 4 hours), and the 200 simple moving average (green, 4 hours).

It also spiked below the 1.2150 level and the 61.8% Fib retracement level of the upward move from the 1.2037 swing low to the 1.2337 high.

If the bears remain in action, the pair could slide below 1.2125. The next key support is seen near the 1.2050 level, below which it could test 1.2000. Any more losses might send the pair toward the 1.1920 level.

On the upside, the pair might struggle to clear the 1.2185 resistance and the 100 simple moving average (red, 4 hours). The next key resistance is near 1.2220, above which the pair could rise toward the 1.2265 level. The next major stop for the bulls could be 1.2320.

Looking at Bitcoin, the price saw a nasty spike toward the $30,000 level after fake news hit the market about spot ETF approval.

Economic Releases

  • US Retail Sales for Sep 2023 (MoM) – Forecast +0.3%, versus +0.6% previous.
  • Canadian Consumer Price Index for Sep 2023 (MoM) – Forecast +0.1%, versus +0.4% previous.
  • Canadian Consumer Price Index for Sep 2023 (YoY) – Forecast +4%, versus +4% previous.