GBP/USD Nosedives To New 2-Year Low Below 1.2200

Key Highlights

· The British pound declined heavily and traded to a new 2-year low against the U.S.dollar.

· GBP/USD struggled to break a crucial bearish trend line with current resistance near 1.2440 on the 4-hours chart.

GBP/USD Technical Analysis

Looking at the 4-hours chart, the pair remained in a bearish zone below 1.2520 in the past few days and followed a negative structure. More importantly, the 100 simple moving average (red, 4-hours) extended its bearish moves.

Recently, the pair failed to break a crucial bearish trend line with current resistance near 1.2440 and the 100 simple moving average (red, 4-hours).

As a result, there was a sharp decline below the 1.2420 and 1.2400 support levels.

The pair even broke the 1.2300 level and traded to new 2-year low below 1.2200. It seems like the pair is under a lot of pressure and it could continue to slide towards the 1.2120 support.

On the upside, there are many resistances near the 1.2300 and 1.2350 levels. The main resistance is near 1.2420-1.2440 area, the same bearish trend line, and the 100 SMA.

Therefore, an upside correction in GBP/USD is likely to face a strong selling interest near 1.2400 in the coming days.

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