Key Highlights
· The British Pound declined recently and tested the 1.3080-1.3100 support against the US Dollar.
· GBP/USD tested a connecting bullish trend line with support at 1.3100 on the 4-hours chart.
GBP/USD Technical Analysis
The British Pound started a downside correction after testing the 1.3250 resistance against the US Dollar. The GBP/USD pair traded below the 1.3150 support, but buyers protected the key 1.3080-1.3100 support.
Looking at the 4-hours chart, the pair formed a high at 1.3257 and corrected below the 38.2% Fib retracement level of the last wave from the 1.2921 low to 1.3257 high. However, the downside move was protected by the 100 simple moving average (red, 4-hours) and 1.3080 level.
Moreover, the 50% Fib retracement level of the last wave from the 1.2921 low to 1.3257 high also acted as a support. It seems like the pair completed a downside correction at a major technical support and it could continue to move higher above 1.3200.
On the upside, the key resistances above 1.3200 are at 1.3220 and 1.3250. On the flip side, there is a connecting bullish trend line formed with support at 1.3100 on the same chart.
