Intraday Market Analysis – GBP Attempts Rebound

August 23, 2021

GBPUSD tests critical support

The pound drifted lower after Britain’s retail sales figures fell in July. The pair has given up all its gains from late July and is testing the critical support at 1.3600 from the daily chart.

A diverging RSI suggests a slowdown in the downward impetus. Its oversold situation may have attracted buying interest in the demand zone. 1.3770 would be the first target in case of a rebound.

Otherwise, a bearish breakout would trigger a new round of sell-off towards 1.3460 as those who bought the dip reverse gears.

USDCAD clears previous peak

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The Canadian dollar tanked after last month’s retail sales failed to impress. The greenback saw increased momentum after it rallied above July’s peak at 1.2800.

The breakout can be a confirmation of a bullish reversal for the weeks to come. A pullback is necessary to let the bulls catch their breath.

An overbought RSI has swung towards the oversold territory. 1.2750 near the previous high is now the immediate support. A rebound would challenge the psychological level of 1.3000.