EUR/USD Holding Support, GBP/USD Starts Fresh Decrease

Technical analysis of Forex market

Key Highlights

  • EUR/USD remained well supported above 1.2050 and 1.2080.
  • It is facing a strong resistance near the 1.2160 and 1.2175 levels.
  • GBP/USD failed to extend gains and declined sharply below 1.3300.
  • Crude oil price rallied above $47.50 before correcting lower.

EUR/USD Technical Analysis

After forming a support base above 1.2050, the Euro started a fresh increase against the US Dollar. EUR/USD climbed above 1.2120, but it struggled to continue higher above 1.2160.

Looking at the 4-hours chart, the pair traded as high as 1.2162, and it settled well above the 200 simple moving average (green, 4-hours) and the 100 simple moving average (red, 4-hours).

Recently, there was a downside correction below the 1.2120 level. The pair even traded below the 50% Fib retracement level of the upward move from the 1.205 swing low to 1.2162 high. However, the pair is still well supported on the downside near the 1.2080 and 1.2050 levels.

There is also a connecting bullish trend line forming with support at 1.2070 on the same chart. If there is a downside break below the trend line support and 1.2050, the pair could revisit the 1.2000 support.

On the upside, the pair is facing a strong resistance near the 1.2160 and 1.2175 levels. A successful break above the 1.2175 resistance zone may possibly start another strong increase. The next major resistance could be near 1.2240 and 1.2250.

Looking at GBP/USD, the pair failed to surpass the 1.3500 resistance and it declined heavily below 1.3300. Besides, gold price struggled near $1,875 and corrected lower. USD/JPY is still above the 103.65 support, but it is facing hurdles near 104.20.

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