GBP/USD support test: Key levels to watch

Traders Union
All News
Financial News
Pound Sterling vs Dollar down 0.49%

Highlights

Sterling fell against the US Dollar following softer UK inflation data, reducing expectations for additional monetary tightening by the Bank of England.
Persistent geopolitical tensions and a stronger US Dollar have further limited upside in GBP/USD, adding to the pair’s vulnerability.
GBP/USD trades below major moving averages with bearish momentum, expected to remain under pressure within $1.3244–$1.3378 as technical signals overwhelmingly favor further declines.

Sterling hit by weaker UK inflation and firm US dollar sentiment

Sterling weakened against the US Dollar, highlighting the impact of shifting macroeconomic dynamics, according to Staradvertiser. Cooler-than-expected UK inflation data has dampened expectations for further monetary tightening, thereby limiting the pound's appeal as noted by Fxstreet. Ongoing geopolitical tensions and a modest rebound in the US Dollar have also restricted any upside in GBP/USD trading, according to FXStreet.

Oversold momentum and bearish signals amid technical breakdown

GBP/USD is trading below its MA-20 at $1.337, MA-50 at $1.3374 on the hourly chart, and MA-200 at $1.3443 on the daily chart. Immediate resistance is defined by the Ichimoku Kijun at $1.3356, while support is seen at $1.3244. Momentum signals are negative: MACD and ADX both confirm continued selling pressure, with RSI at 20.71 placing the pair firmly in oversold territory. Stoch RSI and CCI are also stretched to oversold levels, Bull/Bear Power signals dominance by sellers, and the Awesome Oscillator remains negative—all reinforcing the session's bearish momentum.

Further losses likely as reversal odds remain minimal

Over the next 2–3 trading days, the expected price range for GBP/USD is between $1.3244 and $1.3378, reflecting typical volatility for the pair. The probability of an upside reversal remains very low, while a further decline is considered highly likely. A decisive bullish turnaround would require a clear move above resistance at $1.3356, whereas continued losses may materialize if the support at $1.3244 breaks.

Viktoras Karapetjanc, analyst at Traders Union, sees the current GBP/USD setup as a reflection of broader macroeconomic forces. He notes that softer UK inflation and persistent geopolitical risks weigh on the pound’s outlook. Downside momentum is clear, but Karapetjanc believes market sentiment could shift quickly if resistance at $1.3356 is reclaimed. "GBP/USD remains pressured, but a surprise bounce above resistance could change the tactical landscape overnight."

Previously it was reported that GBP/USD faced ongoing selling pressure with technical indicators suggesting a persistent bearish outlook. The latest market action reinforces this scenario, with multiple momentum signals pointing toward elevated downside risk and making a decisive break below the current support level a critical trigger to monitor in the near term.

Source of Data: GBP Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.