Thu, Mar 23, 2023 @ 18:04 GMT
HomeContributorsTechnical AnalysisGBP/USD Recovery Could Fade Above 1.2150

GBP/USD Recovery Could Fade Above 1.2150

Key Highlights

  • GBP/USD is attempting a recovery wave from the 1.2000 support.
  • It is facing resistance near 1.2180 and 1.2220 on the 4-hours chart.
  • EUR/USD declined to 1.0655 and remains at a risk of more losses.
  • The US Consumer Price Index could decline from 6.5% to 6.2% in Jan 2023 (YoY).

GBP/USD Technical Analysis

The British started a major decline from well above the 1.2350 level against the US Dollar. GBP/USD declined below the 1.2200 support to move into a bearish zone.

Looking at the 4-hours chart, the pair declined below the 1.2160 support zone, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).

There was also a close below the 1.2150 support zone. Finally, it tested the 1.1960 support zone. Recently, the pair started an upside correction and traded above 1.2120. It cleared the 38.2% Fib retracement level of the key decline from the 1.2401 swing high to 1.1961 low.

However, the pair struggled to clear 1.2180 and the 200 simple moving average (green, 4-hours). It is near the 50% Fib retracement level of the key decline from the 1.2401 swing high to 1.1961 low.

The next major resistance is near the 1.2220 level. A clear move above the 1.2220 resistance might start a steady increase towards the 1.2300 resistance zone.

Any more gains could open the doors for a move towards the 1.2400 level, above which the bulls may perhaps aim a retest of the 1.2440 resistance.

Looking at EUR/USD, the pair traded to a new monthly low near 1.0655 and remains at a risk of more losses in the near term.

Economic Releases

  • UK Claimant Count Change for Jan 2023 – Forecast 3.0K, versus 19.7K previous.
  • UK ILO Unemployment Rate for Dec 2022 (3M) – Forecast 3.7%, versus 3.7% previous.
  • US Consumer Price Index for Jan 2023 (MoM) – Forecast +0.5%, versus +0.1% previous.
  • US Consumer Price Index for Jan 2023 (YoY) – Forecast +6.2%, versus +6.5% previous.
  • US Consumer Price Index Ex Food & Energy for Jan 2023 (YoY) – Forecast +5.5%, versus +5.7% previous.
Titan FX
Titan FXhttp://titanfx.com
Titan FX is a technology driven online ECN forex and commodities broker that provides traders with next generation trading conditions, institutional grade spreads, fast trade execution, deep top tier liquidity and the security of financial registration and oversight.

Featured Analysis

Learn Forex Trading