GBP/USD declined heavily in the past few days and broke the 1.3000 support area. Conversely, USD/CAD climbed towards the 1.3300 resistance area and it is currently consolidating gains.
Important Takeaways for GBP/USD and USD/CAD
- The British Pound is back in a downtrend below the 1.3000 support area.
- There is a major bearish trend line forming with resistance near 1.2910 on the hourly chart of GBP/USD.
- USD/CAD climbed higher nicely above the 1.3250 and 1.3280 resistance levels.
- There is a rising channel forming with support near 1.3285 on the hourly chart.
GBP/USD Technical Analysis
The British Pound failed to gain strength above the 1.3200 resistance area against the US Dollar. As a result, the GBP/USD pair started a fresh decline and broke many supports near the 1.3100 area.
Moreover, there was a break below the 1.3000 support area and the 50 hourly simple moving average. Finally, the pair declined below the 1.2950 support area. The recent decline was such that the pair spiked below 1.2900 and traded as low as 1.2881 on FXOpen.
The pair is currently consolidating losses above 1.2880. It is testing the 23.6% Fib retracement level of the recent decline from the 1.2958 high to 1.2881 low.
On the upside, there is a major bearish trend line forming with resistance near 1.2910 on the hourly chart of GBP/USD. The trend line close to the 50% Fib retracement level of the recent decline from the 1.2958 high to 1.2881 low.
The main resistance is near the 1.2920 level, above which the pair could recover towards the 1.2950 resistance area. A successful break above the 1.2920 and 1.2950 levels is needed to start a strong recovery in the near term.
On the downside, there is a short term support near the 1.2880 level. If GBP/USD fails to correct above the 1.2920 resistance, there is a risk of more losses below the 1.2880 and 1.2860 levels in the near term.
USD/CAD Technical Analysis
The US Dollar started a fresh increase from the 1.3150 support area against the Canadian Dollar. The USD/CAD pair broke a few important hurdles near 1.3200 and 1.3220 to enter a positive zone.
Besides, there was a break above the 1.3250 level and the 50 hourly simple moving average. It opened the doors for more upsides above the 1.3300 resistance area.
The pair traded as high as 1.3320 and it is currently correcting gains. It dipped towards the 1.3280 level. A swing low is formed near 1.3290 and the pair is now approaching the 23.6% Fib retracement level of the recent decline from the 1.3320 high to 1.3290 swing low.
On the upside, the first resistance is seen near the 1.3305 level. It coincides with the 50% Fib retracement level of the recent decline from the 1.3320 high to 1.3290 swing low.
If the pair settled above 1.3300 and 1.3305, it is likely to continue higher towards 1.3320 and 1.3325. Any further gains may lead USD/CAD towards the 1.3350 level.
On the downside, an immediate support is near the 1.3190 level. Moreover, there is a rising channel forming with support near 1.3285 on the hourly chart.
If USD/CAD breaks the channel support and 1.3280, there is a risk of a downside correction towards the 1.3250 support area in the near term.