GBP/USD At Risk Of A Larger Decline Below 1.2250

This past week, the British pound found support near the 1.2260 level and recovered against the US dollar. However, GBP/USD failed to continue above 1.2450 and started a fresh decline. Looking at the 4-hours chart, the pair traded as high as 1.2466 and declined below the 1.2400 support zone. Besides, there was a break below the 1.2350 support zone. The pair tested the 1.2280 level and settled well below both the 100 simple moving average (red, 4-hours) and the 200 simple moving average (green, 4-hours). On the downside, there are key supports near the 1.2260 and 1.2250 levels. If there is a downside break below the 1.2250 support zone, there is a risk of a larger decline towards the 1.2200 and 1.2150 levels. Conversely, GBP/USD might attempt a fresh increase above 1.2350. However, there is a major resistance zone is forming near the 1.2400 level and a connecting bearish trend line on the same chart. Therefore, a successful close above the 1.2400 resistance zone and the 100 simple moving average (red, 4-hours) is needed to start a convincing upward move in the coming sessions.

GBP/USD

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