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

• GBP/USD churned on Thursday, giving up a tenth of a percent.
• US CPI inflation data came in above expectations, vexing rate cut hopes.
• Coming up on Friday: UK GDP and production figures, US PPI and UoM sentiment.

GPB/USD roiled on Thursday, battling just north of the 1.3000 handle before trimming 0.1% for the day. The Greenback was bolstered by a misfire in US Consumer Price Inflation (CPI) inflation figures, which printed hotter than markets expected. A raft of UK and US data is due on Friday, giving the Cable a tense finish to an otherwise quiet week.

Headline US CPI inflation fell less than expected through the year ended in September, declining from 2.5% to 2.4%. Median market forecasts had called for a print of 2.4% YoY. On the other hand, core US CPI inflation ticked higher YoY in September, rising to 3.3% from the previous 3.2%. 

US Initial Jobless Claims unexpectedly rose for the week ended October 4, climbing to 258K week-on-week and clipping the highest rate of new jobless benefits seekers since June of 2023. 

Mixed rate-impacting data flummoxed rate markets on Thursday. Rising unemployment figures bolster hopes for rate cuts as the Federal Reserve (Fed) looks to keep the US labor market afloat, while still-hot inflation makes it harder for investors to expect a faster pace and depth of rate trims.

Friday delivers a packed data docket for Cable traders. UK Gross Domestic Product (GDP) figures for August will kick things off, expected to increase to 0.2% MoM in August from the previous month’s flat print of 0.0%. UK Manufacturing and Industrial Production are both expected to rebound in August. Manufacturing Production is expected to recover to 0.2% MoM compared to the previous -1.0% contraction, while Industrial Production is forecast to bounce to 0.2% MoM from the previous -0.8%.

US Producer Price Index (PPI) inflation will follow up during the US market session. September’s core PPI print for the year ended in September is expected to accelerate to 2.7% YoY from last month’s 2.4%.

GBP/USD price forecast

The GBP/USD pair is currently trading at 1.3056, showing a minor drop of 0.11% for the day. The price action suggests a bearish trend emerging after a period of consolidation near the 50-day Exponential Moving Average (EMA), currently at 1.3108. The pair recently broke below this key technical level, indicating further downside momentum. The 200-day EMA, at 1.2840, acts as a crucial support zone, which could be tested if selling pressure continues to mount. The bearish candlestick patterns in recent sessions support the view that sellers are in control.

The Moving Average Convergence Divergence (MACD) indicator further supports the bearish outlook. The MACD line has crossed below the signal line, with the histogram showing increasing negative bars. This suggests that the downside momentum is picking up strength. The pair may struggle to break above the 50-day EMA in the short term, which has now become a resistance level. Should the current downward trend persist, the next area of interest for traders would likely be the psychological 1.3000 mark, followed by the 1.2840 support level near the 200-day EMA.

In the broader context, GBP/USD’s price action appears to be in a corrective phase after its significant uptrend from July to early September. The pair's recent highs around 1.3400 now look increasingly distant as downside risks dominate. With the MACD reinforcing the bearish signal and the price failing to hold above the 50-day EMA, further declines seem likely unless a significant reversal occurs. Key upcoming economic data, including inflation reports and central bank decisions, could play a pivotal role in determining the pair’s next move.

GBP/USD daily chart

• GBP/USD fails to gain traction amid mixed US economic data.
• Sellers remain in charge if prices remain below 1.3055; key support levels are eyed at 1.3001 and 1.2939.
• Buyers could regain control above 1.3055 and target the 50-DMA

The Pound Sterling remains on the backfoot against the Greenback, yet it bounced off a four-week low of 1.3010 in early trading during the North American session. The GBP/USD exchanges hands at 1.3040, down 0.54% at the time of writing.

GBP/USD Price Forecast: Technical outlook

GBP/USD recovered some ground during Thursday’s session following the release of mixed US data. Although inflation edged up, the labor market showed signs of weakness.

Given the backdrop, the pair initially dipped to a daily low of 1.3010 before stabilizing at current exchange rates. Nevertheless, Pound bulls must reclaim the October 9 low of 1.3055 if they want to remain hopeful of higher prices.

In that outcome, bulls could challenge the 50-day moving average (DMA) and the day’s high of 1.3093. Further gains are seen above 1.3100.

Conversely, failure to regain 1.3055 and sellers could drive the exchange rate toward the September 11 low of 1.3001. Once those levels are surpassed, the GBP/USD could test the 100-DMA at 1.2939.

GBP/USD Price Action – Daily Chart

The Pound Sterling (GBP) is little changed on the day, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

GBP holds consolidation range

“The RICS House Price Balance index turned positive in September (11%) for the first time in two years after a marginal gain in August was revied lower to 0%. The survey reflects real estate surveyors seeing higher prices minus those reporting declines and supports the outlook for a further strengthening in the UK housing market as UK interest rates ease.”

“The GBP retains a soft undertone against the USD but Cable is still holding in the 1.3060/1.3100 trading range that it has held since the start of the week. Underlying trends remain negative though and a test of 1.30 support remains a risk. Weakness below 1.30 on a sustained basis would increase chances of a deeper drop back to 1.27/1.28.”

The Pound Sterling (GBP) is expected to drift lower, potentially dropping below 1.3050; lackluster momentum suggests 1.3000 is out of reach. In the longer run, price action suggests further GBP weakness; the next major support at 1.3000 may not come into view so soon, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

Momentum suggests 1.3000 is out of reach

24-HOUR VIEW: “Yesterday, we expected GBP to trade in a sideways range of 1.3065/1.3135. GBP subsequently traded between 1.3057 and 1.3106, closing slightly lower at 1.3075 (-0.21%). The mild decline resulted in a slight increase of momentum. Today, we expect GBP to drift lower, potentially dropping below 1.3050. Due to the lackluster momentum, any decline is unlikely to reach 1.3000. Resistance levels are at 1.3090 and 1.3115.”

1-3 WEEKS VIEW: “We have held a negative view in GBP since the middle of last week (as annotated in the chart below). In our most recent narrative from Monday (07 Oct, spot at 1.3130), we indicated that ‘although the recent price action suggests further GBP weakness, conditions are oversold, and the next major support at 1.3000 may not come into view so soon.’ There is no change in our view. Overall, only a breach of 1.3150 (‘strong resistance’ level previously at 1.3185) would suggest that the current downward pressure has eased.”

• GBP/USD edges higher amid subdued USD price action, though the upside seems limited.
• Expectations for more aggressive BoE policy easing undermine the GBP amid a bullish USD.
• Bulls also seem reluctant ahead of Thursday’s release of the US consumer inflation figures.

The GBP/USD pair trades with a mild positive bias around the 1.3075 area during the Asian session on Thursday, albeit it lacks bullish conviction and remains within the striking distance of a nearly one-month low touched the previous day. 

The US Dollar (USD) consolidates its recent strong gains to the highest level since August 16 and continues to draw support from rising bets for a regular 25 basis points (bps) interest rate cut by the Federal Reserve (Fed) in November. The expectations were reaffirmed by the FOMC meeting minutes released on Wednesday, which showed a consensus that the outsized rate cut would not lock the central bank into any specific pace for future cuts. This keeps the yield on the benchmark 10-year US government bond elevated above the 4% threshold, or its highest level since July 31, which continues to underpin the buck and acts as a headwind for the GBP/USD pair. 

Meanwhile, last week's dovish remarks by the Bank of England (BoE) Governor Andrew Bailey suggested that the central bank might be heading towards speeding up its rate-cutting cycle. This, in turn, might contribute to the British Pound's (GBP) relative underperformance and cap any meaningful upside for the GBP/USD pair. Traders might also prefer to wait for the release of the US consumer inflation figures, which along with the US Producer Price Index (PPI) on Friday, might influence expectations about the Fed's rate-cut path. This, in turn, will drive the USD demand in the near term and provide some meaningful impetus to the currency pair. 

Heading into the key data risks, traders on Thursday might take cues from the BoE Credit Conditions Survey to grab short-term opportunities. Nevertheless, the aforementioned fundamental backdrop suggests that the path of least resistance for the GBP/USD pair is to the downside, suggesting that any subsequent move up might still be seen as a selling opportunity. Spot prices seem poised to extend the recent sharp pullback from the 1.3435 area, or the highest level since March 2022 touched last month.

• GBP/USD consolidates within the 1.3060-1.3140 range, with sellers maintaining control after last week's US jobs report boosted the Greenback.
• The pair is downward biased after falling below the 50-DMA, with key support at the September 11 low of 1.3001 and the 100-DMA at 1.2935.
• A break above 1.3100 could signal a reversal, with resistance at 1.3200, followed by the October 3 peak of 1.3269.

The British Pound lost some ground against the Greenback on Wednesday as traders await minutes of the Federal Reserve’s last meeting and US inflation data on Thursday. At the time of writing, the GBP/USD trades at 1.3070, below its opening price by 0.26%.

GBP/USD Price Forecast: Technical outlook

The GBP/USD has consolidated within the 1.3060-1.3140 range for the last three days. The lack of a catalyst keeps market players uncertain, though last week’s US jobs report boosted the Greenback, which reached levels last seen in August 2024.

Momentum hints that sellers are in charge, as portrayed by the bearish reading of the Relative Strength Index (RSI).

In the short term, the pair is downward biased. The drop below the 50-day moving average (DMA) at 1.3087 opened the door for further losses. However, if sellers want to remain in charge, they must drive the exchange rate to the September 11 swing low of 1.3001. If that level is cleared, the 100-DMA at 1.2935 would be up for grabs, followed by the 200-DMA at 1.2784.

Conversely, if GBP/USD reclaims 1.3100 and rallies above 1.3200, it would open the door for further upside. The next resistance would be October 3 peak at 1.3269, followed by the October 2 high at 1.3305.

GBP/USD Price Action – Daily Chart

The Pound Sterling (GBP) is trading marginally lower on the day, reflecting the generally soft tone of the major currencies against the USD, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

GBP consolidates in tight

“GBP is trading a bit lower on the day. GBP snap higher in the cross last week as bargain hunters fade EURGBP gains to the 0.84 area.”

“Cable is carving out a flat consolidation range on the intraday chart between 1.3060/1.3110. That is helping stabilize short-term trends but the broader undertone in GBPUSD remains negative, with a test of 1.30 support the main risk ahead.”

“Weakness below 1.30 on a sustained basis would increase chances of a deeper drop back to 1.27/1.28.”

• GBP/USD remains below 1.3100 as traders brace for the FOMC Minutes.
• Upbeat US labor market data has diminished risks of an economic slowdown.
• Investors expect the BoE to cut interest rates again by 25 bps.

The GBP/USD pair trades with caution below the crucial resistance of 1.3100 in Wednesday’s London session. The Cable remains under pressure as the US Dollar (USD) extends its upside, with traders pricing out another Federal Reserve (Fed) 50 basis points (bps) interest rate cut in November.

The market sentiment remains risk-averse amid escalating tensions between Israel and Iran. S&P 500 futures have posted some losses in European trading hours. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, strives to rally further above 102.70.

Market participants are not expecting the Fed to reduce interest rates again with a larger-than-usual pace of 50 bps as risks of a United States (US) economic slowdown have diminished after the release of the upbeat labor market data for September, which showed robust job growth and stronger-than-expected wage growth momentum.

In Wednesday’s session, investors will focus on the Federal Open Market Committee (FOMC) minutes for the September meeting, which will be published at 18:00 GMT. In the policy meeting, Fed officials unanimously voted to reduce interest rates by 50 basis points (bps) to 4.75%-5.00%, except Fed Governor Michelle Bowman, who supported a usual rate cut of 25 bps.

In the United Kingdom (UK) region, the Pound Sterling (GBP) will be guided by market expectations for the Bank of England’s (BoE) interest rate outlook for the remainder of the year. The BoE is expected to cut interest rates again by 25 bps in one of its two meetings remaining this year. On the economic front, investors will focus on the monthly Gross Domestic Product (GDP) and the factory data for August, which will be published on Friday.

The Pound Sterling (GBP) is expected to trade in a sideways range of 1.3065/1.3135. In the longer run, price action suggests further GBP weakness; the next major support at 1.3000 may not come into view so soon, UOB Group Quek Ser Leang and Peter Chia note.

Moving slowly towards 1.3065

24-HOUR VIEW: “We expected GBP to edge lower yesterday, but we held the view that ‘any decline is likely limited to a test of 1.3050.’ Our view did not materialise, as after dipping briefly to 1.3065 in London trade, GBP traded sideways for the rest of the sessions. Momentum indicators are turning flat. Today, we expect GBP to trade in a sideways range of 1.3065/1.3135.”

1-3 WEEKS VIEW: “We have held a negative view in GBP since the middle of last week. In our most recent narrative from two days ago (07 Oct, spot at 1.3130), we indicated that “although the recent price action suggests further GBP weakness, conditions are oversold, and the next major support at 1.3000 may not come into so soon.” We will continue to hold the same view, as long as 1.3185 (no change in ‘strong resistance’ level from yesterday) is not breached.”

• GBP/USD attracts fresh sellers on Wednesday and is pressured by a combination of factors.
• The GBP continues to be weighed down by BoE Governor Bailey’s dovish remarks last week.
• Reduced bets for a jumbo Fed rate cut underpin the USD and contribute to the pair’s slide. 

The GBP/USD pair struggles to capitalize on the previous day's modest recovery gains and meets with a fresh supply during the Asian session on Wednesday. Spot prices currently trade around the 1.3085-1.3080 area and remain within the striking distance of a nearly four-week low touched on Monday.

The British Pound (GBP) continues with its relative underperformance in the wake of market conviction that the Bank of England (BoE) might be heading towards speeding up its rate-cutting cycle. The bets were lifted by BoE Governor Andrew Bailey's dovish remarks last week, saying that there was a chance that the central bank could become a bit more aggressive in cutting rates if there's further good news on inflation. This, in turn, is seen as a key factor exerting downward pressure on the GBP/USD pair. 

The US Dollar (USD), on the other hand, stands tall near a seven-week high touched last week amid diminishing odds for a more aggressive policy easing by the Federal Reserve (Fed). In fact, the markets are currently pricing in over an 85% chance that the Fed will lower borrowing costs by 25 basis points (bps) in November. Moreover, escalating geopolitical tensions in the Middle East and the disappointment over China's stimulus update underpins the buck, contributing to the offered tone surrounding the GBP/USD pair. 

The aforementioned fundamental backdrop suggests that the path of least resistance for spot prices is to the downside. Bearish traders, however, might refrain from placing aggressive bets and prefer to wait for the release of the FOMC meeting minutes later during the US session. Apart from this, the US Consumer Price Index (CPI) and the Producer Price Index (PPI) on Thursday and Friday, respectively, will influence the USD price dynamics and help in determining the next leg of a directional move for the GBP/USD pair.

• GBP/USD pumped the brakes on recent losses but remains below the 50-day EMA.
• Latest Fed Meeting Minutes due Wednesday, UK MPC policy hearings on Thursday.
• Investor hopes for an extended acceleration of Fed rate cuts have vanished.

GBP/USD pulled the plug on a five-day losing streak, closing a scant one-sixth of a percent in the green on Tuesday. Despite Cable bidders successfully snapping the near-term losing streak, the pair remains stubbornly on the low side of the 50-day Exponential Moving Average (EMA).

UK data remains thin in the front half of the trading week, leaving GBP traders to twiddle their thumbs until the Bank of England’s (BoE) Monetary Policy Report Hearings, slated for Thursday. UK Gross Domestic Product (GDP) figures will follow on Friday.

The Federal Reserve’s (Fed) latest Meeting Minutes from the September rate cut meeting will be released on Wednesday, giving Greenback traders plenty to chew on. Markets widely hoped for a follow-up double rate cut in November after the Fed blew the doors open with a jumbo 50 bps rate trim in September. However, core inflation still holding above Fed target levels and US labor figures that wildly outran expectations last week have firmly depressed rate cut hopefuls. 

According to the CME’s FedWatch Tool, rate markets see nearly 90% odds that the Fed will follow up September’s jumbo 50 bps rate cut with a more modest 25 bps on November 7. Fed officials widely telegraphed that a weakening in the US labor market would be required to push the Federal Reserve into further outsized rate trims.

GBP/USD price forecast

GBP/USD is experiencing a short-term correction after a strong uptrend. The key level to watch is the 50-day EMA, which currently acts as resistance. A break above this level could reignite bullish momentum. However, the bearish signals from the MACD and the price's failure to maintain above the 50-day EMA suggest that traders should remain cautious. If the price dips below the 1.30 support, it could signal a deeper correction toward the 200-day EMA. Conversely, a break above the 50-day EMA would indicate that the bulls are regaining control.

GBP/USD daily chart

• GBP/USD trades below 1.3100 after posting an upbeat retail sales report.
• A daily close above 1.3100 could target further upside, with resistance at 1.3175 and 1.3200, followed by 1.3266.
• A drop below 1.3100 may shift momentum to sellers, targeting 1.3058 and the September 11 low of 1.3001.

The Pound Sterling recovered some ground against the Greenback on Tuesday, following a better-than-expected retail sales report, yet it has fallen below the 1.3100 figure as the North American session progresses. The GBP/USD trades at 1.3090, virtually unchanged.

GBP/USD Price Forecast: Technical outlook

Price action shows some consolidation at around the 1.3050 – 1.3120 area for the second straight day. Even though momentum shifted bearish, according to the Relative Strength Index (RSI), the GBP/USD printed a leg-up on Tuesday and pierced the 1.3100 area.

If bulls push prices higher and achieve a daily close above the previously mentioned key resistance level, it will open the door for further upside.

That outcome will expose the October 4 high at 1.3175. Next will be the 1.3200 figure, followed by the August 27 daily high of 1.3266, ahead of the 1.3300 mark.

Conversely, if GBP/USD tumbles below 1.3100 and achieves a daily close below the latter, sellers will have the upper hand and can challenge the current week low of 1.3058 before targeting the September 11 cycle low of 1.3001.

GBP/USD Price Action – Daily Chart

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

GBP little changed on the day

“Cable is showing a marginal gain intraday but there appears to be little impetus behind price action. The British Retail Consortium reported a 1.7% rise in like-for-like retail sales in the September year.”

“Spot has slipped into a minor consolidation range just below 1.31. the intraday chart does reflect a small bull hammer pattern forming in European trade to coincide with spot breaking above steep bear trend resistance off of the late August high.”

“These are mildly positive developments at least but the pound will need to show a lot more strength—above 1.3175—if it is to recover. Trend momentum on the shorter-term studies remains deeply bearish at this point. Support is 1.3050/60.”

The Pound Sterling (GBP) continued to trade with a heavy bias after BoE Governor Bailey unexpectedly spoke about adopting a more aggressive easing stance. Pair was last at 1.3100 levels., OCBC’s FX strategist Christopher Wong notes.

Catch-up in dovish re-pricing should continue to dampen GBP bulls

“In an interview with the Guardian last week, he said that the BoE could become a ‘bit more aggressive’ and ‘a bit more activist’ in its approach to cutting rates if the news on inflation continued to be good. This is a flip from the last MPC in Sep where policymakers emphasized the need for policy to stay restrictive for ‘sufficiently long’ and that most members saw the need for gradual approach to removing restraint.

“A catch-up in dovish re-pricing should continue to dampen GBP bulls. Our house view on rates remains unchanged – another 25bp cut in the Bank Rate before year-end, likely at the November MPC meeting. Thereafter, we expect one 25bp Bank Rate cut in every quarter in 2025. Our rate cut expectation is based on our lower inflation forecasts than BoE’s. Governor Bailey’s latest comments have to reflect a change in the assessment of inflation and/or growth outlook.”

“Daily momentum is bearish bias while decline in RSI slowed near oversold conditions. Consolidation likely for now. Support here at 1.3090 (50 DMA), 1.30 (38.2% fibo retracement of Apr low to Sep high) and 1.2935 (100 DMA). Resistance at 1.3166 (23.6% fibo), 1.3230 (21 DMA).”

The Pound Sterling (GBP) could edge lower; any decline is likely limited to a test 1.3050. In the longer run, price action suggests further GBP weakness; the next major support at 1.3000 may not come into view so soon, UOB Group FX analysts Quek Ser Leang and Lee Sue Ann note.

Next major support at 1.3000 may not come into view

24-HOUR VIEW: “We expected GBP to trade in a sideways range of 1.3080/1.3180 yesterday. However, it edged lower to 1.3060, closing down by 0.29% at 1.3085. The price action has resulted in a slight increase in momentum. Today, GBP could continue to edge lower, but given the mild momentum, any decline is likely limited to a test of 1.3050. The major support at 1.3000 is unlikely to come into view. Resistance is at 1.3105; a breach of 1.3135 would mean that the current mild downward pressure has faded.”

1-3 WEEKS VIEW: “We continue to hold the same view as yesterday (07 Oct, spot at 1.3130). As indicated, although the recent price action suggests further GBP weakness, conditions are oversold, and the next major support at 1.3000 may not come into so soon. The downside risk will remain intact provided that GBP does not break above 1.3185 (‘strong resistance’ level was at 1.3220 yesterday).”

• GBP/USD gains some positive traction and snaps a five-day losing streak to a multi-week low. 
• A modest USD downtick lends support to the pair, though a combination of factors caps gains.
• Diminishing odds for an aggressive Fed policy easing limit the USD losses and act as a headwind.

The GBP/USD pair attracts some buyers during the Asian session on Tuesday and for now, seems to have snapped a five-day losing streak to a nearly four-week low, around the 1.3560 area touched the previous day. Spot prices, however, struggle to build on the uptick beyond the 1.3100 mark, warranting some caution for bullish traders.

The US Dollar (USD) remains depressed below a seven-week high touched on Friday and turns out to be a key factor lending some support to the GBP/USD pair. That said, reduced bets for another oversized interest rate cut by the Federal Reserve (Fed), amid signs of a still resilient US labor market, might hold back the USD bears from placing aggressive bets. Apart from this, a softer risk tone should act as a tailwind for the safe-haven buck and cap the upside for the currency pair.

Investors remain concerned that Middle East tensions could turn into a wider conflict. Furthermore, not-so-optimistic comments by the National Development and Reform Commission (NDRC) – overshadow the recent optimism led by China's stimulus bonanza and tempers investors' appetite for riskier assets. This is evident from a generally weaker tone around the equity markets, which, in turn, could drive some haven flows towards the USD and keep a lid on the GBP/USD pair. 

Meanwhile, the Bank of England (BoE) Governor Andrew Bailey said last week that there was a chance that the central bank could become a bit more aggressive in cutting rates if there's further good news on inflation. This might further contribute to capping gains for the British Pound (GBP) and suggests that the path of least resistance for the GBP/USD pair is to the downside. Hence, any further move up might still be seen as a selling opportunity and runs the risk of fizzling out quickly. 

Moving ahead, there isn't any relevant market-moving economic data due for release on Tuesday, either from the UK or the US, leaving the USD and the GBP/USD pair at the mercy of Fedspeak. The focus, meanwhile, remains glued to the release of the FOMC meeting minutes on Wednesday. This will be followed by the US Consumer Price Index (CPI) and the Producer Price Index (PPI), which will play a key role in driving the USD demand and provide a fresh impetus to the currency pair.

• GBP/USD shed another 0.25% on Monday as markets tilt risk-off.
• Rate cut hopes continue to evaporate, and a lack of UK data keeps Cable pinned.
• FOMC meeting minutes, US CPI inflation, and UK GDP dot the economic landscape this week.

GBP/USD sunk another one-quarter of one percent on Monday, easing into a fresh four-week low and closing below the 1.3100 handle for the first time since mid-September. Investors rate cut hopes are buckling under the weight of a firmer-than-expected US labor market, and geopolitical tensions have kept trader risk appetite pinned.

Investor appetite took a leg down to kick off the fresh trading week as market hopes for further outsized rate cuts continue to dwindle. Rate markets now overwhelmingly expect the Fed’s next rate move on November 7 will be a demure quarter-point cut, down from the heady 50 bps that rate markets expected just after the Fed’s opening volley of a 50 bps double cut in September. Fedspeak has steadily telegraphed to markets that a further deterioration in the US economy, and specifically the US labor market, will be the thing that opens the door to further extreme moves on rates.

Last week’s bumper Nonfarm Payrolls (NFP) eviscerated nearly all hopes for a double-wide rate cut in November, to the point rate traders are seeing a one-in-five chance of no rate cut at all on November 7, according to the CME’s FedWatch Tool.

Data remains limited on the UK side, with GBP traders forced to wait until Friday’s UK Gross Domestic Product (GDP) print. Meanwhile, Greenback speculators will be keeping a close eye on US Consumer Price Index (CPI) inflation figures due on Thursday.

GBP/USD price forecast

Cable has closed in the red for a fifth straight day as fear-fueled Greenback bids continue to rise. The pair has dipped back below the 50-day Exponential Moving Average (EMA), and GBP/USD daily candlesticks have closed below 1.3100 for the first time since mid-September. Despite setting multi-year highs last month, Cable is still down 2.8% peak-to-trough.

GBP/USD daily chart

• GBP/USD declines 0.26% to 1.3076, after peaking at 1.3134, influenced by dovish BoE remarks and rising US Treasury yields.
• Bearish RSI indicates seller dominance; key supports are at the 50-DMA of 1.3077, 1.3031, and 1.3001.
• Resistance stands at 1.3100, with additional targets at 1.3134 and the October 4 high of 1.3174.

The Pound Sterling extends its losses against the Greenback in early trading during the North American session, down 0.26%. Dovish remarks by the Bank of England (BoE) Governor Andrew Bailey began Sterling’s downfall last week. Therefore, the GBP/USD trades at 1.3076 after hitting a daily high of 1.3134.

GBP/USD Price Forecast: Technical outlook

During the overnight session for American traders, the GBP/USD hit a three-week low of 1.3058 before recovering some ground. The jump in US Treasury yields bolstered the Greenback, which has risen to a 7-week high above 102.00 yet remains shy of 103.00.

The Relative Strength Index (RSI) shows signs that sellers are in charge after shifting bearish. Given the backdrop, the path of least resistance for the Pound is tilted to the downside.

The first support for GBP/USD would be the 50-day moving average (DMA) at 1.3077. On further weakness, the next support would be the September 12 low of 1.3031, followed by the latest swing low of 1.3001, the September 11 low.

Conversely, if the pair rises above 1.3100, look for a re-test of the day’s high of 1.3134, ahead of challenging 1.3150. Up next will be the October 4 peak at 1.3174 before 1.3200.

GBP/USD Price Action – Daily Chart

The Pound Sterling (GBP) has underperformed over the past few sessions, losing ground to the USD and EUR since Wednesday, Scotiabank’s Chief FX Strategist Shaun Osborne notes.  

GBP slips to minor new cycle lows

“EURGBP’s rebound through the 0.84 area appears to have stalled but the rebound in the cross may blunt the sustained run of GBP gains against the EUR in the past few months for now.”

“Bearish—minor new, short-term cycle lows for Cable this morning are keeping the broader GBP tone weak. Losses from the recent peaks just above 1.34 risk extending to test key support at 1.30 amid a pickup in bearish momentum. Resistance is 1.3175.”