GBP/USD has started a new rally above the 1.2625 zone. USD/CAD is declining and trading below the support at 1.3415.
Key points from today’s GBP/USD and USD/CAD analysis
- GBP is aiming for further gains above the 1.2755 resistance.
- On FXOpen’s GBP/USD hourly chart, there was a breakout above a major bearish trend line with resistance near 1.2740.
- USD/CAD started a new decline after failing to break through the resistance level at 1.3465.
- On the hourly chart of FXOpen, a short-term connecting bullish trend line has formed with support near 1.3368.
GBP/USD technical analysis
On the GBP/USD hourly chart on FXOpen, the pair has formed a base above the 1.2625 level. As mentioned in the previous analysis, the British pound has started a decent rally against the US dollar, breaking above the resistance zone at 1.2665.
The pair gained strength above the 1.2690 level. The bulls pushed the pair above the 1.2725 level and the 50-hour simple moving average. More importantly, it broke above a major bearish trend line at the resistance level near 1.2740.
The pair tested the 1.2755 zone and is currently consolidating gains. If there is a downside correction, the pair could test the same trendline at 1.2740.
The first major support lies at the 23.6% Fib retracement level of the upward movement from the swing low of 1.2625 to the high of 1.2755. The next major support is 1.2690 and the 50-hour simple moving average.
The 50% Fib retracement level rising from the swing low of 1.2625 to the high of 1.2755 is also located at 1.2690. If the price breaks below 1.2690, the decline may widen. The next important support is around the 1.2665 level. If we experience more losses, we may need to try the support at 1.2625.
On the other hand, bulls may aim for further gains. The RSI has crossed the 65 level on the GBP/USD chart and is currently approaching a major hurdle at 1.2755. If the pair breaks above the 1.2755 zone, it could head towards 1.2800. Further upside could open the door to a test of 1.2850.
USD/CAD technical analysis
On the USD/CAD hourly chart of FXOpen, the pair rose towards the resistance zone at 1.3440 before the bears emerged. The US dollar had formed a high against the Canadian dollar around 1.3642, but recently fell below the support at 1.3415.
There was also a close below the 50-hour simple moving average and 1.3390. The bulls are currently active near the 1.3370 level. A short-term connecting bullish trend line has also formed with support near 1.3368.
The first major support is around 1.3360. A close below the 1.3360 level could trigger a significant decline. In the above case, USD/CAD is likely to test his 1.3300. Any further losses could open the door for a fall towards the support at 1.3250.
If there is another rally, the pair could face resistance near the 23.6% Fib retracement level, which falls from the swing high of 1.3464 to the low of 1.3367.
The next important resistance on the USD/CAD chart is near the 50-hour simple moving average at 1.3415. The 50% Fib retracement level of the down move from the swing high of 1.3464 to the low of 1.3367 is also located at 1.3415.
If there is a break above 1.3415, the pair could move higher towards the resistance at 1.3440. The next major resistance level lies near the 1.3465 level, above which a steady rise towards the 1.3500 resistance zone is likely.
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