Fundamental Overview
The US Dollar remains the strongest currency but overall, we haven’t got much action in the past couple of weeks due to the lack of key catalysts and the market’s pricing remaining largely unchanged around roughly three rate cuts by the end of 2025 despite a series of strong US data.
This might be a signal that we are bottoming out here and we could see a correction to the downside in the US Dollar. This should translate in a higher GBP/USD exchange rate.
On the GBP side, last week we got the UK CPI report with the data coming in higher than expected. Moreover, the BoE’s members sounded a bit less dovish recently. This has strengthened the probabilities for no change at the December meeting but didn’t change much for the overall easing expectations in 2025.
GBPUSD Technical Analysis – Daily Timeframe
On the daily chart, we can see that GBPUSD failed to sustain the break below the major trendline and it’s now consolidating around the trendline. The buyers will likely keep on piling in around these levels to position for a pullback into the downward trendline. The sellers, on the other hand, will want to see the price falling back below the major trendline to target new lows.
GBPUSD Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the pair looks to be bottoming out here and we might see a pullback into the major downward trendline. The first target for the buyers should be the resistance around the 1.27 handle where we can also find the 38.2% Fibonacci retracement level for confluence.
GBPUSD Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we have a minor resistance zone around the 1.2615 level where the price got rejected from several times in the past days. The buyers will want to see a breakout to increase the bullish bets into new highs, while the sellers will likely step in here to position for a drop into new lows. The red lines define the average daily range for today.
Upcoming Catalysts
Today we get the US PCE report and the latest US Jobless Claims figures.