GBP/USD: Recovery Could Be Capped Near 1.3600
- GBP/USD nosedived below 1.3600 and 1.3550.
- A key bearish trend line is forming with resistance near 1.3600 on the 4-hours chart.
- EUR/USD is stable above 1.1500, but it is facing many hurdles.
- Gold price rallied above the $1,780 and $1,800 resistance levels.
GBP/USD Technical Analysis
The British started a fresh decline after it failed to clear 1.3830 against the US Dollar. GBP/USD declined heavily below the 1.3700 and 1.3600 support levels.
Looking at the 4-hours chart, the pair even traded below the 1.3550 support, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).
The pair even spiked below 1.3500 and a low was formed near 1.3427. The pair is now attempting a recovery above 1.3450. It even moved above the 23.6% Fib retracement level of the downward move from the 1.3695 swing high to 1.3427 low.
On the upside, an immediate resistance is near the 1.3560 level. The next major resistance is near the 1.3570 level. It is close to the 50% Fib retracement level of the downward move from the 1.3695 swing high to 1.3427 low.
There is also a key bearish trend line forming with resistance near 1.3570 on the same chart. A close above 1.3570 and 1.3600 could open the doors for a decent increase.
On the downside, an initial support is near 1.3465 level. The next major support is near 1.3450, below which there is a risk of a larger decline towards 1.3400.
Looking at EUR/USD, the pair is still stable above 1.1500, but the bulls are facing a lot of hurdles near 1.1600 and 1.1620.
- German ZEW Business Economic Sentiment Index for Nov 2021 – Forecast 19.0, versus 22.3 previous.
- US Producer Price Index for Oct 2021 (MoM) – Forecast +0.5%, versus +0.5% previous.
- US Producer Price Index for Oct 2021 (YoY) – Forecast +8.7%, versus +8.6% previous.