- GBP/USD declined below the key 1.3250 support to move into a negative zone.
- A major bearish trend line is forming with resistance near 1.3215 on the 4-hours chart.
- Main Supports on the downside are near 1.3050 and 1.3000.
- The Euro Zone GDP could decline 12.1% in Q2 2020 (QoQ).
GBP/USD Technical Analysis
This past week, the British Pound surged towards the 1.3500 resistance against the US Dollar. GBP/USD traded as high as 1.3482 and recently started a major downward move.
Looking at the 4-hours chart, the pair gained bearish momentum below the 1.3350 and 1.3320 support levels. There was a break below the 50% Fib retracement level of the upward move from the 1.3053 low to 1.3482 high.
More importantly, the pair broke the key 1.3250 support level and even spiked below the 100 simple moving average (red, 4-hours). The next major support on the downside is near the 1.3100 level and the 200 simple moving average (green, 4-hours).
Any further losses could lead the pair towards the 1.3050 support zone. On the upside, there is a major bearish trend line forming with resistance near 1.3215 on the same chart.
The main hurdle for the bulls could be near the 1.3250 level (support turned resistance), above which GBP/USD might move into the positive zone.
Overall, GBP/USD remains at a risk of more losses as long as it is below the 1.3250 pivot level. Having said that, the bulls might take a strong stand near the 1.3050 and 1.3000 levels.
Upcoming Economic Releases
- Euro Zone Gross Domestic Product Q2 2020 (QoQ) - Forecast -12.1%, versus -12.1% previous.
- Euro Zone Gross Domestic Product Q2 2020 (YoY) - Forecast -15%, versus -15% previous.
- UK Inflation Report Hearings.