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GBP/USD Looks Set for Fresh Gains

June 21, 2022

  • GBP/USD tested support near 1.1935.
  • Bearish trend line has formed resistance near 1.2340.

The British Pound, US Dollar started to decline from above the 1.2500 level. GBP/USD broke below the 1.2000 level before correcting higher.

GBP/USD 4-Hour Chart (Trend: BULLISH)

On the 4-hour chart, the GBP/USD pair traded as low as 1.1933 before starting an upside correction. The quote recovered above 1.2350 and the 61.8% Fibonacci retracement level of the downward move from the swing high of 1.2599 to the swing low of 1.1933. There has since been a retest of the 1.2200 support level, with the quote now trading near 1.2270 and the 50% Fibonacci retracement level (of the 1.2599 high to the 1.1933 low). 

If the pair continues bearish, the quote will first need to test resistance near the 1.2340 level and the key bearish trend line. Above this there is further resistance near 1.2400 and both the 100-MA (red) and 200-MA (blue). Further gains could push the quote up towards the 1.2600 level.

In contrast, for the pair to turn bearish, the quote will first need to test support near  the 1.2150 level. Below this there is further support near 1.2080. Further losses could take the quote back down towards the 1.2000 level.

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