GBP/USD is declining and is trading below the 1.2400 and 1.2350 support levels. EUR/GBP is rising again and is trading near the key 0.8900 resistance area.
Important Takeaways for GBP/USD and EUR/GBP
- The British Pound is under pressure and is trading well below the 1.2400 support area.
- There are two major bearish trend lines forming with resistance near 1.2325 and 1.2370 on the hourly chart of GBP/USD.
- EUR/GBP is grinding higher and it recently broke the 0.8875 resistance area.
- There is a strong support forming near 0.8875 and a bullish trend line on the hourly chart.
GBP/USD Technical Analysis
The British Pound topped below the 1.2600 resistance area against the US Dollar. The GBP/USD pair started a fresh decline and broke many key supports near the 1.2500 and 1.2440 levels.
Moreover, there was a close below the 1.2400 support area and the 50 hourly simple moving average. The decline was such that the price even traded below the 1.2300 level. A new weekly low was formed near 1.2270 on FXOpen and the pair is currently consolidating losses.
It tested the 23.6% Fib retracement level of the recent decline from the 1.2503 high to 1.2270 low. However, the upward move was capped by the 1.2320 resistance area.
Additionally, there are two major bearish trend lines forming with resistance near 1.2325 and 1.2370 on the hourly chart of GBP/USD. The first trend line coincides with the 50 hourly SMA, while the second line coincides with the 38.2% Fib retracement level of the recent decline from the 1.2503 high to 1.2270 low.
Therefore, an upside break above the 1.2325 and 1.2370 levels is needed for a decent recovery. The next key resistance is near the 1.2400 area.
Conversely, if the GBP/USD pair fails to correct above the 1.2325 or 1.2370 level, there are chances of a fresh decline. An immediate support is near the 1.2270 level, below which the pair might slide towards the 1.2220 support area.
EUR/GBP Technical Analysis
The Euro started a solid upward move from the 0.8800 support area against the British Pound. The EUR/GBP pair broke the key 0.8840 and 0.8850 resistance levels to move into a positive zone.
Moreover, there was a break above the 0.8875 resistance and the 50 hourly simple moving average. Finally, the pair tested the 0.8900 resistance area and a swing high was formed near 0.8904.
The pair is currently correcting gains, with an immediate support near the 0.8890 level. It represents the 23.6% Fib retracement level of the recent wave from the 0.8846 low to 0.8904 high. Below 0.8890, there are many supports waiting above the 0.8850 level.
The main support is forming near 0.8875 and a bullish trend line on the hourly chart. Moreover, the 50% Fib retracement level of the recent wave from the 0.8846 low to 0.8904 high is also near 0.8875.
Therefore, a downside correction towards the 0.8875 level might find a strong buying interest. The next key support is near 0.8840 and another bullish trend line on the same chart.
On the upside, EUR/GBP is facing hurdles near 0.8900. If there is a clear break above the 0.8900 and 0.8905 resistance levels, the pair could accelerate gains towards the 0.8925 and 0.8935 levels in the near term.