GBP/USD declined sharply below the 1.3165 and 1.3085 support levels. USD/CAD also declined recently and broke the key 1.3400 support level to move into a bearish zone.
Important Takeaways for GBP/USD and USD/CAD
- The British Pound failed to clear the 1.3260 resistance and later declined below 1.3100.
- There is a major bearish trend line formed with resistance near 1.3055 on the hourly chart of GBP/USD.
- USD/CAD faced a strong resistance near 1.3445 and later declined below 1.3400.
- The pair broke a key bullish trend line with support at 1.3048 on the hourly chart to move into a bearish zone.
GBP/USD Technical Analysis
The British Pound traded nicely above the 1.3200 level this past week against the US Dollar. The GBP/USD pair made a few attempts to gain strength above the 1.3260 resistance area, but it failed and later declined below the 1.3200 support area.
There was a strong decline and the pair broke the 1.3165 and 1.3085 support levels. There was even a close below the 1.3085 level and the 50 hourly simple moving average. A swing low was formed near 1.2979 on FXOpen.
The pair is currently correcting higher and it recently traded above the 23.6% Fib retracement level of the last decline from the 1.3135 high to 1.2979 low. On the upside, there are many hurdles near the 1.3060 level and the 50 hourly simple moving average.
There is also a major bearish trend line formed with resistance near 1.3055 on the hourly chart of GBP/USD. The trend line is close to the 50% Fib retracement level of the last decline from the 1.3135 high to 1.2979 low.
Therefore, if the pair corrects higher, it is likely to face a lot of sellers near the 1.3055 and 1.3060 resistance levels. The next key resistance is near the 1.3085 level, the previous support level.
On the downside, an immediate support is at 1.3000, followed by the 1.2975 support. Any further losses may push the pair below the 1.2950 support level in the near term.
USD/CAD Technical Analysis
The US Dollar remained in a strong uptrend above the 1.3400 support level against the Canadian Dollar. However, the USD/CAD pair faced a strong resistance near the 1.3445 and 1.3450 levels.
As a result, there was a strong bearish reaction below the 1.3400 and 1.3380 support levels. The pair even settled below the 1.3365 level and the 50 hourly simple moving average. It tested the 1.3340 support level and traded as low as 1.3341.
It is currently consolidating losses and it recently tested the 23.6% Fib retracement level of the last decline from the 1.3450 high to 1.3341 low.
If there is an upside correction, the pair could test the 1.3400 resistance zone, where sellers are likely to emerge. It coincides with the 50% Fib retracement level of the last decline from the 1.3450 high to 1.3341 low.
On the downside, an initial support is near the 1.3340 level, below which there is a risk of a sharp drop. The pair could trade towards the 1.3300 support area, which is also a pivot area and a strong buy zone for buyers in the near term.