CFD Trading Rate Great Britain Pound vs US Dollar (GBPUSD)

The Pound Sterling (GBP) is little changed while Gilts are a little softer in line with the broader tone in fixed income as UK markets are brace for tomorrow’s budget announcement, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

GBP little changed in tight range near 1.2975

“More spending (investment in health services, for example) and more debt issuance is expected after Chancellor Reeves announced changes in the way the government measures indebtedness to give it more room to manoeuver and achieve its policy goals.”

“GBP’s late week rebound has not developed any further upside momentum so far this week. In fact, spot has tended to stick very close to the 100-day MA (1.2974) over the past couple of sessions after rebounding to that point last Thursday.”

“Price action still holds some promise of improvement though and gains through 1.2995/00 could still see the pound extend to the 1.3070/75 area. Support is 1.2910.”

The Pound Sterling (GBP) is expected to trade in a sideways range of 1.2940/1.2995. In the longer run, downward momentum is slowing; should GBP break above 1.3000, it would indicate that GBP is not declining further, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

GBP has a chance of breaking above 1.3000

24-HOUR VIEW: “We expected GBP to trade sideways between 1.2930 and 1.2990 yesterday. It subsequently traded in a higher range of 1.2942/1.3001, closing largely unchanged at 1.2972. The price action still appears to be part of a sideways trading phase. Today, we expect GBP to trade in a 1.2940/1.2995 range.”

1-3 WEEKS VIEW: “Yesterday (28 Oct, spot at 1.2960), we indicated that ‘downward momentum is slowing, and should GBP break above 1.3000 (‘strong resistance’ level), it would indicate that GBP is not declining further.’ In NY trading, GBP rose briefly to 1.3001, pulling back to close little changed at 1.2972 (+0.09%). As our ‘strong resistance’ has not been clearly breached, we will continue to hold the same view for now. That said, the likelihood for GBP to decline further is not high.”

• GBP/USD meets with a fresh supply on Tuesday and seems vulnerable to sliding further.
• Bets for smaller Fed rate cuts revive the USD demand and exert pressure on the pair.
• The technical setup favors bears and supports prospects for a further depreciating move.

The GBP/USD pair attracts fresh sellers following the previous day's good two-way price move and slides closer to mid-1.2900s during the Asian session on Tuesday. Spot prices, however, hold above the lowest level since August 16 touched last week and remain at the mercy of the US Dollar (USD) price dynamics. 

Bets for a less aggressive policy easing by the Federal Reserve (Fed) assist the USD in stalling its overnight pullback from a three-month peak and drag the GBP/USD pair lower. Apart from this, rising bets for more interest rate cuts by the Bank of England (BoE) in November and December suggest that the path of least resistance for spot prices remains to the downside. 

From a technical perspective, the recent repeated failures near the 1.3000 psychological mark and a breakdown below the 100-day Simple Moving Average (SMA) validate the near-term negative outlook. Moreover, oscillators on the daily chart are holding deep in negative territory and are still away from being in the oversold zone. Hence, a subsequent slide back towards the 1.2900 mark, or the monthly swing low, looks like a distinct possibility. 

Some follow-through selling will be seen as a fresh trigger for bearish traders and pave the way for an extension of a downtrend from the 1.3435 region, or the highest level since February 2022 touched last month. The GBP/USD pair might then aim to test the very important 200-day SMA, currently pegged near the 1.2800 round-figure mark, with some intermediate support near the 1.2860 region.

On the flip side, the 1.3000 mark now seems to have emerged as an immediate strong barrier, above which spot prices could climb to the 1.3050 supply zone. A sustained strength beyond the latter might trigger a short-covering move and lift the GBP/USD pair beyond the 1.3100 round figure, towards the 1.3115-1.3120 resistance zone. Some follow-through buying will negate the negative outlook and shift the bias in favor of bulls.

GBP/USD daily chart

• GBP/USD posts modest losses around 1.2970 in Tuesday’s early Asian session. 
• The uncertainty surrounding the US presidential election and geopolitical risks might support the USD. 
• The expectation that the BoE would cut rates this year weighs on the GBP. 

The GBP/USD pair trades with mild losses near 1.2970 on Tuesday during the early Asian session. The US Dollar Index (DXY) currently trades flat around 104.30 after reaching a three-month high of 104.57 in the previous session. Traders might prefer to wait on the sidelines ahead of the key US economic data this week. 

The encouraging US economic data last week suggests that the US economy remains resilient, lifting the Greenback. The advanced US Q3 Gross Domestic Product (GDP) and the October Nonfarm Payrolls (NFP) this week will be closely watched as they might offer some hints about the size and speed of the US Federal Reserve’s (Fed) rate cuts. US rate futures have priced in 96.8% odds that the Fed will cut rates by 25 basis points (bps) in November, according to the CME FedWatch tool. 

Meanwhile, the uncertainty over the US presidential election and the ongoing geopolitical tensions in the Middle East are likely to support the US Dollar (USD), the safe-haven currency. 

The rising bets that the Bank of England (BoE) would cut the interest rates in all two remaining meetings this year might drag the Pound Sterling (GBP) lower. However, the hawkish remarks from the BoE policymaker Catherine Mann might cap its downside. BoE’s Mann, an outspoken hawk, said last week "It would be premature to cut rates if you have structural persistence in the relationship between wages and price formation.”

The Pound Sterling (GBP) is unchanged on the day as local markets slip into a holding pattern ahead of Wednesday’s budget, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

GBP consolidates on the day

“Chancellor Reeves is expected to loosen fiscal policy somewhat and if she manages to pull that off and maintain credibility with investors, the GBP might benefit.”

“Cable is holding a trading range below 1.30. The short-term pattern of trade lends itself to a potentially bullish resolution of the recent trading range. Spot gains above 1.3005 resistance will add to the positive short-term tone on the intraday chart that developed late last week following the pound’s reversal from 1.2910 (now support).”

“Gains through the low 1.30s target a push on to 1.3070/75.”

• GBP/USD consolidates below 1.3000, with RSI indicating a slight upward shift but lacking the strength to break recent peaks.
• A GBP/USD breakout above 1.3000 could target resistance at 1.3076 and 1.3102, followed by the 50-day SMA at 1.3140.
• Key support levels lie at the 100-day SMA at 1.2969 and last week’s low of 1.2906, with further downside to the 200-day SMA at 1.2803.

The Pound Sterling recovered some ground against the US Dollar, though it failed for the second consecutive trading day to reach 1.3000. This exacerbated a pullback toward the current exchange rate, as the GBP/USD trades at 1.2981, slightly above 0.20% of its opening price.

GBP/USD Price Forecast: Technical outlook

The GBP/USD consolidates at around the bottom trendline of an ascending channel, shy of cracking 1.3000. Momentum has shifted slightly upwards, with the Relative Strength Index (RSI) slope pointing up. However, the RSI remains below the latest peak, which, once cleared, would mean that buyers are moving in.

If GBP/USD clears 1.3000, the next resistance would be the October 18 peak at 1.3076 before challenging the October 15 daily high at 1.3102. Once surpassed, the 50-day Simple Moving Average (SMA) would be up at 1.3140.

On the other hand, sellers need to clear the 100-day SMA at 1.2969 before challenging last week’s lowest point at 1.2906. On further weakness, bears could drive the GBP/USD to test the 200-day SMA at 1.2803.

GBP/USD Price Chart – Daily

The Pound Sterling (GBP) is expected to trade sideways between 1.2930 and 1.2990. In the longer run, downward momentum is slowing; should GBP break above 1.3000, it would indicate that GBP is not declining further, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

GBP expected to trade between 1.2930 and 1.2990

24-HOUR VIEW: “GBP traded sideways between 1.2959 and 1.2998 last Friday, narrower than our expected range of 1.2930/1.3000. The price action did not result in an increase in either downward or upward momentum. Today, GBP is expected to continue to trade sideways, probably between 1.2930 and 1.2990.”

1-3 WEEKS VIEW: “In our most recent narrative from last Thursday (24 Oct, spot at 1.2915), we indicated that ‘The price action indicates GBP could decline further to 1.2860.’ Since then, GBP has not been able to make further headway on the downside. Downward momentum is slowing, and should GBP break above 1.3000 (no change in ‘strong resistance’ level), it would indicate that GBP is not declining further.”

• GBP/USD drifts lower to 1.2945 in Monday’s early European session, down 0.11% on the day. 
• The negative view of the pair remains in play below the 100-day EMA and bearish RSI indicator. 
• The first downside target is located at 1.2870; the immediate resistance level emerges at 1.3000. 

The GBP/USD pair extends the decline to around 1.2945 during the early European session on Monday. A bullish US Dollar (USD) on the back of bets for a less aggressive easing by the Federal Reserve (Fed) drags the pair lower. In the absence of top-tier economic data released from the UK and the US, the USD price dynamics will continue to play a key role in influencing the pair. 

GBP/USD keeps the bearish vibe unchanged as the major pair holds below the key 100-period Exponential Moving Average (EMA) on the daily timeframe. The downward momentum is also supported by the Relative Strength Index (RSI), which stands below the 50-midline near 37.70, supporting the sellers in the near term. 

The lower limit of the Bollinger Band at 1.2870 acts as an initial support level for GBP/USD. A decisive break below this level could see a drop to 1.2763, the low of August 13. The additional downside filter to watch is 1.2665, the low of August 8. 

On the upside, the first upside barrier emerges at the 1.3000 psychological level. A move past the mentioned level could clear the way for a climb to the next potential bullish target at 1.3071, the high of October 18. The next hurdle is seen at 1.3185, the high of September 5. 

GBP/USD daily chart

• GBP/USD edges lower at the start of a new week amid broad-based USD strength.
• Expectations for a less aggressive Fed policy easing continue to underpin the USD.
• Bets for more BoE rate cuts weigh on the GBP and exert pressure on the major. 

The GBP/USD pair kicks off the new week on a softer note and trades around the 1.2960-1.2955 region, just below the 100-day Simple Moving Average (SMA) during the Asian session. Spot prices, however, remain within striking distance of the lowest level since August 16, near the 1.2900 mark touched last week and seem vulnerable to prolonging a one-month-old downtrend amid a bullish US Dollar (USD). 

The USD Index (DXY), which tracks the Greenback against a basket of currencies, stands firm near a three-month peak and looks to build on its gains registered over the past four weeks amid bets for a less aggressive easing by the Federal Reserve (Fed). In fact, market participants seem convinced that the US central bank will lower borrowing costs by 25 basis points in November as the incoming US macro data continue to suggest that the economy remains on strong footing. 

The US Census Bureau reported on Friday that Durable Goods Orders in the US decreased by 0.8% in September, slightly better than expectation for a decline of 1%. Additional details of the report showed that new orders excluding transportation increased 0.4% during the reported month. Furthermore, the University of Michigan's Consumer Sentiment Index reached a six-month high of 70.5 in October, better than both the preliminary result and the previous month's reading. 

The data validates the view that the Fed will proceed with modest rate cuts over the year, which, in turn, triggers a fresh leg up in the US Treasury bond yields and continues to underpin the USD. The British Pound (GBP), on the other hand, is undermined by rising bets for more interest rate cuts by the Bank of England (BoE) in November and December, bolstered by a fall in the UK Consumer Price Index to the lowest level since April 2021 and below the central bank's 2% target. 

The aforementioned fundamental backdrop suggests that the path of least resistance for the GBP/USD pair is to the downside. Even from a technical perspective, the recent repeated failures to near the 1.3000 psychological mark support prospects for an extension of the downfall from the 1.3435 area, or the highest level since February 2022 touched last month.

• GBP/USD remains above the 100-day SMA at 1.2967, with a break above 1.3000 potentially targeting 1.3015 and weekly high of 1.3057.
• RSI signals mild bullish momentum, but bias remains bearish below the neutral line, adding to resistance at the 1.3000 mark.
• Sellers need to break below 1.2967, with further support at the bottom trendline near 1.2925/35 for a bearish shift.

The Pound Sterling recovered some ground and traded at around three-day highs of 1.2998 yet remained unable to crack the 1.3000 figure at the time of writing. Market mood has improved slightly, a headwind for Greenback, which, despite that, is headed to sustain weekly gains of more than 0.50%.

GBP/USD Price Forecast: Technical outlook

The GBP/USD trades above the 100-day Simple Moving Average (SMA) at 1.2967, with buyers pressing to clear the 1.3000 figure. The Relative Strength Index (RSI) is bearish below its neutral line but slightly tilted to the upside in the short term.

If buyers lift GBP/USD above 1.3000, they could push prices to October 22 high at 1.3015, followed by the weekly peak at 1.3057. Conversely, sellers need to drive the GBP/USD below the 100-day SMA, followed by the bottom trendline of an ascending channel at around 1.2925/35.

GBP/USD Price Chart – Daily

The Pound Sterling (GBP) is a mild outperformer on the session, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

GBP outperforms moderately

“Markets were showing some signs of concern yesterday over an adjustment in how UK debt is measured for setting UK fiscal rules.”

“This will allow the government to borrow a lot more in next week’s budget potentially. The announcement by Chancellor Reeves Thursday pressured UK Gilts. Markets appear less perturbed this morning, however, with UK bonds outperforming European debt slightly.”

“GBP was showing some positive signs on the intraday chart yesterday and while progress has been limited, short-term technicals still offers some tantalizing signs of potential gains this morning. Spot is testing minor trend resistance at 1.2980 and a clear push above here should prompt additional gains to the 1.3050 zone over the next 1-2 days.”

“Support is 1.2945/50 and 1.2910.”

The Pound Sterling (GBP) is expected to trade in a range between 1.2930 and 1.3000. In the longer run, price action suggests GBP could decline further to 1.2860, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

GBP to trade between 1.2930 and 1.3000

24-HOUR VIEW: “Our view for GBP to ‘continue to weaken’ yesterday was incorrect. Instead of weakening, GBP rose to a high of 1.2985. Despite the relatively strong advance, upward momentum has not increased much. Today, we expect GBP to trade in a range, probably between 1.2930 and 1.3000. GBP is unlikely to break clearly below 1.2930 or above 1.3000.”

1-3 WEEKS VIEW: “On Tuesday (22 Oct, spot at 1.2980), we indicated that GBP ‘must break and remain 1.2940 before a resumption of weakness can be expected.’ After GBP plummeted below 1.2940, we indicated yesterday (24 Oct, spot at 1.2915) that ‘The price action indicates GBP could decline further to 1.2860.’ We did not anticipate the rebound that reached 1.2985. However, as our ‘strong resistance’ level at 1.3000 has not been breached yet, we will continue to hold the same view for now.”

• GBP/USD recovered four-tenths of a percent on Thursday.
• Markets bid up the Pound Sterling despite UK PMI figures missing the mark.
• US PMI data came in above expectations, limiting Greenback losses.

GBP/USD recovered some much-needed ground on Thursday, climbing 0.4% as Cable bidders grapple with keeping price action north of the 1.2900 handle. UK Purchasing Managers Index (PMI) figures broadly missed the mark early Thursday, but both the Services and Manufacturing PMI components held north of contraction territory below 50.0.

US PMI figures broadly beat expectations, containing US Dollar losses and keeping GBP/USD tied up just below 1.3000. US Manufacturing PMI activity figures rose to 47.8 in October, beating the expected 47.5 and climbing even further from August’s 47.3. Meanwhile, the Services PMI component bounced to 55.3, climbing from the previous month’s 55.2 and beating the expected decline to 55.0.

Meaningful UK economic data takes a break on Friday, leaving markets to contend with US Durable Goods Orders and an update to 5-year Consumer Inflation Expectations from the University of Michigan (UoM). Headline US Durable Goods Orders in September are expected to contract a full 1.0% MoM, extending the recent downturn after August’s flat-footed 0.0% print. October’s UoM 5-year Consumer Expectations are expected to come in close to their previous print of 3.0%.

GBP/USD price forecast

The GBP/USD pair is currently in a corrective phase after a significant bullish rally that peaked near the 1.3300 level in early October. Following the recent decline, the price has found support near the 200-day EMA (black line) at 1.2848, which could act as a key level for the pair in the coming sessions. The 50-day EMA (blue line) at 1.3057 is now positioned as an overhead resistance, and with the pair trading below this level, the short-term trend remains bearish. However, the price has managed to bounce slightly from the 1.2900 psychological level, signaling that buyers are stepping in to defend the 200-day EMA.

The MACD indicator is currently in bearish territory, with the MACD line (blue) sitting below the signal line (orange), and the histogram displaying negative momentum. This suggests that the bearish pressure is still prevalent. However, the recent narrowing of the MACD histogram indicates that selling momentum may be fading, and a potential bullish crossover could materialize if the pair holds above the 1.2848 support level. A daily close below this support would likely accelerate the downward move toward the 1.2700 area, while a rebound above the 1.3050 resistance could reinvigorate the bulls, aiming for the 1.3200 zone.

GBP/USD daily chart

• GBP/USD bounces off two-month low of 1.2907, testing resistance near the 100-day SMA at 1.2964.
• Sellers maintain control as momentum points downward, with key support at 1.2900 and the 200-day SMA at 1.2800.
• A move above 1.3000 could open the door for a test of 1.3102, with further resistance at the 50-day SMA at 1.3140.

The Pound Sterling recovered some ground against the Greenback after UK GILTS yields jumped after Chancellor Reeves confirmed that a change to UK fiscal rules would help fund GBP 20 billion in investment. At the time of writing, the GBP/USD trade was 1.2974, up by 0.41%.

GBP/USD Price Forecast: Technical outlook

The GBP/USD bounced off the bottom trendline of an ascending channel after hitting a two-month low of 1.2907. Since then, the pair recovered some ground and hit a high of 1.2987, before struggling to sustain the advance above the 100-day Simple Moving Average (SMA) at 1.2964.

Momentum shows sellers are in charge, even though the Relative Strength Index (RSI) aimed slightly up but so far failed to clear the latest peak. Therefore, the path of least resistance is tilted to the downside.

The first support for GBP/USD would be 1.2900. Once surpassed, sellers could push prices toward the 200-day SMA at 1.2800.

On the other hand, a bullish continuation could happen if GBP/USD climbs above 1.3000 and clears the October 15 high at 1.3102. Further upside lies at the 50-day SMA at 1.3140.

GBP/USD Price Chart – Daily

UK PMI data for October were broadly weaker than forecast. Manufacturing, Services and Composite readings all held above the 50 point this month but the sharp drop in Manufacturing (50.3, from 51.5) and the Composite measure (51.7, from 52.6) suggests a notable slowing in growth momentum, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

GBP overlooks weak PMIs

“BoE Governor Bailey commented yesterday that inflation was falling faster than expected but services inflation was still inconsistent with the Bank’s price target. The Governor speaks again today but the trend in UK data reports support market expectations for a 25bps rate cut next month.”

“Short-term price patterns in Cable indicate a minor rebound in price may be developing. Intraday price patterns show a minor “morning star” bull reversal pattern developed overnight ahead of 1.29. A push above intraday resistance at 1.3025 should drive more gains in the pound towards 1.3075/00. Support is 1.2900/10.”

The Pound Sterling (GBP) could continue to weaken; oversold conditions suggest 1.2860 is likely out of reach for now. In the longer run, price action suggests GBP could decline further to 1.2860, UOB Group FX analysts Quek Ser Leang and Lee Sue Ann note.  

Has a chance to fall towards 1.2860

24-HOUR VIEW: “Two days ago, we expected GBP to weaken, but we were of the view that ‘the 1.2940 level is expected to provide strong support.’ After GBP dropped to 1.2945 and rebounded, we indicated yesterday that ‘there is a chance for GBP to dip towards 1.2940 again before a more sustained rebound is likely.’ However, GBP broke clearly below 1.2940 and dropped further to 1.2908. GBP could continue to weaken today, but severely overbought conditions suggest 1.2860 is likely out of reach for now. There is another support level at 1.2890. Resistance levels are at 1.2940 and 1.2965.”

1-3 WEEKS VIEW: “Our most recent narrative was from Tuesday (22 Oct, spot at 1.2980), wherein GBP ‘must break and remain 1.2940 before a resumption of weakness can be expected.’ We highlighted that ‘The likelihood of GBP breaking clearly below 1.2940 will remain intact, provided that the ‘strong resistance’ level at 1.3060 is not breached in the next couple of days.’ Yesterday, GBP broke clearly below 1.2940. The price action indicates GBP could decline further to 1.2860. On the upside, the ‘strong resistance’ level has moved lower to 1.3000 from 1.3060.”

• GBP/USD holds ground ahead of PMI data release from both nations.
• BoE Governor Andrew Bailey indicated that inflation is currently below the target level primarily because of annual base effects.
• The US Dollar may appreciate due to the prevailing sentiment of nominal rate cuts by the Fed in 2024.

The GBP/USD pair trades around 1.2930 during the Asian session on Thursday, staying near its 10-week low of 1.2907 reached on Wednesday. Traders are likely to focus on the Purchasing Managers Index (PMI) figures from both the United Kingdom (UK) and the United States (US), which are scheduled for release during the day.

During a discussion at the Institute of International Finance's annual membership meeting in Washington, D.C., on Wednesday, Bank of England Governor Andrew Bailey stated that inflation is currently below target due to annual base effects. Bailey noted that the high savings rate indicates consumer caution and added that pension funds should not be required to make compulsory allocations to UK assets.

The upward movement of the GBP/USD pair can be linked to a slight decline in the US Dollar (USD), influenced by lower US Treasury yields. As of this writing, the 2-year and 10-year yields on US Treasury bonds are at 4.06% and 4.22%, respectively. However, the US Dollar Index (DXY), which measures the USD's value against six major currencies, surged to its highest level since late July, reaching 104.57 on Wednesday.

The US Dollar may further appreciate as signs of economic resilience and increasing inflation concerns have diminished the likelihood of a significant rate cut by the Federal Reserve in November. According to the CME FedWatch Tool, there is an 88.9% probability of a 25-basis-point rate cut, with no expectation for a larger 50-basis-point cut.

• GBP/USD backslid half of a percent on Wednesday.
• Global PMIs including the UK and the US are due throughout Thursday.
• Central banker appearances to dominate headlines as the week winds down.

GBP/USD shed another half of a percent on Wednesday, tipping into a fresh ten-week low and grinding down toward the 1.2900 handle. Purchasing Managers Index (PMI) figures from both the UK and the US are due on a rolling schedule throughout Thursday, and investors will be keeping an eye out for a slew of central banker appearances from both the Bank of England (BoE) and the Federal Reserve (Fed).

The Pound Sterling swooned on Wednesday, declining further as GBP markets buckle under the weight of a broad-market Greenback recovery and investors brace for an overall decline in UK PMI prints for October.

Median market forecasts are expecting a slight downtick in UK activity numbers, with October’s Services PMI specifically expected to ease to 52.2 from 52.4 the previous month. On the US side, median market forecasts expect October’s US PMI figures to come in mixed, with the Manufacturing component expected to rise to 47.5 from 47.3, while the Services PMI component is expected to tick slightly lower to 55.0 from 55.2.

GBP/USD price forecast

GBP/USD has extended its bearish momentum, falling to the 1.2910 level, as downside pressure persists. The pair has recently broken below the 50-day EMA, which sits at 1.3079, indicating that the bears remain in control. The next key support level to watch is the 200-day EMA at 1.2847. A break below this level could signal further losses towards the 1.2800 psychological level. The recent price action shows a series of lower highs and lower lows, confirming the bearish trend that has been developing since the October highs.

The MACD is further confirming this bearish sentiment, with the MACD line crossing below the signal line and the histogram deepening in negative territory. This suggests that selling pressure could continue in the near term, with little sign of a bullish reversal. However, if the pair manages to hold the 200-day EMA, a bounce-back towards the 50-day EMA could offer short-term relief. Traders should remain cautious as the overall trend points to further downside risk unless key support levels hold.

GBP/USD daily chart

• GBP/USD falls for the third consecutive day, trading below the 100-day SMA at 1.2962, with downside risks growing.
• Bearish RSI indicates further weakness, with key support at 1.2910-1.2920 and the 200-day SMA at 1.2799.
• A rebound could see a retest of the 1.3000 level, with next resistance at 1.3070 and the 50-day SMA at 1.3138.

The Pound Sterling extended its losses for the third straight day against the Greenback amid a scarce economic docket in the UK that will feature remarks of Bank of England (BoE) Governor Andrew Bailey. At the time of writing, the GBP/USD trades at 1.2954, down 0.22%.

GBP/USD Price Forecast: Technical outlook

The GBP/USD has fallen below the 100-day simple moving average (SMA) at 1.2962, opening the door for further downside. Sellers are gathering some steam, as depicted by the Relative Strength Index (RSI).

The RSI is bearish and extending its downtrend yet shy of turning oversold. Hence, the GBP/USD could continue to edge lower.

If GBP/USD decisively breaks 1.2950, the next support would be the bottom trendline of an ascending channel at 1.2910-1.2920, followed by the 1.2900 mark. On further weakness, the next stop would be the 200-day SMA at 1.2799.

However, if GBP/USD rebounds at around the 100-day SMA, look for a retest of 1.3000. If buyers punch that level, the next resistance would be the October 18 peak at 1.3070, ahead of the 50-day SMA at 1.3138.

GBP/USD Price Chart – Daily