GBP/USD Reverses Gains and Now At Risk of More Losses
- GBP/USD declined sharply below the 1.2250 support.
- It traded below a major bullish trend line at 1.2370 on the 4-hours chart.
- EUR/USD extended its decline below the 1.0800 support.
- Gold price might decline further towards the $1,850 support.
GBP/USD Technical Analysis
The British Pound made a few attempts to clear the 1.2450 resistance against the US Dollar. However, GBP/USD failed and started a fresh decline below 1.2400.
Looking at the 4-hours chart, the pair declined below the 1.2320 and 1.2250 support levels. There was break below a major bullish trend line at 1.2370. The pair even declined below the 61.8% Fib retracement level of the upward move from the 1.1841 swing low to 1.2447 high.
The pair settled below the 1.220 level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).
An immediate support is near the 1.2000 level or the 76.4% Fib retracement level of the upward move from the 1.1841 swing low to 1.2447 high. The next major support is near the 1.1850 zone or the last key swing low.
If there is a downside break, the pair could decline towards the 1.1750 level. On the upside, the pair is facing resistance near 1.2110.
The first major resistance is near the 1.2180 level and the 200 simple moving average (green, 4-hours). A clear move above the 1.2180 resistance might start a steady increase towards the 1.2250 resistance zone.
Any more gains could open the doors for a move towards the 1.2320 level. The next key hurdle is near 1.2450, above which the pair could climb towards the 1.2620 resistance zone.
Looking at gold price, the bears remained active and it seems like they might aim a move towards the $1,850 level in the near term.
- US Goods and Services Trade Balance for Dec 2022 - Forecast $-68.5B, versus $-61.51B previous.