The Pound Sterling trims some of its Wednesday gains versus the US Dollar, down by over 0.48% following solid US data. The sell-off comes amid risk aversion and augments the safe-haven appeal of the Greenback. At the time of writing, the GBP/USD trades at 1.3375, after peaking near 1.3545. Read More...
British Pound remains muted as UK monthly GDP rises 0.1%, as expectedThe British Pound (GBP) remains almost muted against its major currency peers after the release of the monthly United Kingdom (UK) Gross Domestic Product (GDP) data for May. The Office for National Statistics (ONS) has reported that the economy expanded 0.1%, as expected, after contracting at a similar pace in April. Read More...
British Pound weakens below 1.3550 on renewed US strikes on IranThe GBP/USD pair declines to near 1.3530 during the early Asian session on Thursday. The British Pound (GBP) weakens against the US Dollar (USD) as renewed conflict and shipping disruptions in the Strait of Hormuz have reignited energy-driven inflation risks. Traders brace for the UK monthly Gross Domestic Product (GDP) report and the US Retail Sales data, which are due later on Thursday. Read More...
Key Points:GBP/USD pulled back as traders reacted to economic reports from U.S. and UK. USD/CAD made an attempt to settle below the support level at 1.4010 - 1.4025.USD/JPY gained ground amid rising Treasury yields.
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U.S. Dollar Moves Higher As Traders React To Economic Data
DXY 160726 4h Chart U.S. Dollar Index gains ground as traders react to the Retail Sales report. The report indicated that Retail Sales increased by +0.2% month-over-month in June, in line with analyst estimates. Retail Sales Ex Autos declined by -0.2%, compared to analyst forecast of -0.1%.
Today, traders also had a chance to take a look at the Initial Jobless Claims report. The report indicated that 208,000 Americans filed for unemployment benefits in a week, compared to analyst consensus of 217.000. The report showed that labor market remained in decent shape, which was bullish for the U.S. dollar.
NAHB Housing Market Index decreased from 36 (revised from 35) in June to 34 in July, compared to analyst forecast of 35.
U.S. Dollar Index climbed above the support at 100.50 – 100.65 and is trying to settle above the 100.75 level. In case this attempt is successful, U.S. Dollar Index will head towards the 50 MA at 100.92. A move above the 50 MA will open the way to the test of the resistance at 101.15 – 101.30.
EUR/USD Retreats As Traders Take Profits After Recent Rebound EUR/USD 160726 4h Chart EUR/USD pulls back as traders focus on economic reports from the U.S. Pending Home Sales declined by -5.4% month-over-month in June, compared to analyst forecast of -0.5%.
The nearest support level for EUR/USD is located in the 1.1420 – 1.1435 range. A successful test of this level will open the way to the test of the next support, which is located in the 1.1350 – 1.1365 range.
GBP/USD Pulls Back As UK Industrial Production Misses Estimates GBP/USD 160726 4h Chart GBP/USD is losing ground as traders focus on UK GDP report. The report showed that UK GDP increased by +0.1% month-over-month in May, in line with analyst consensus.
Manufacturing Production increased by +0.1% month-over-month in May, compared to analyst forecast of -0.2%. Industrial Production decreased by -0.5%, while analysts expected that it would drop by -0.1%.
In case GBP/USD manages to settle below the support level at 1.3450 – 1.3465, it will head towards the 50 MA at 1.3400. A move below the 50 MA will open the way to the test of the next support level at 1.3335 – 1.3350.
USD/CAD Tests Support At 1.4010 – 1.4025 USD/CAD 160726 4h Chart USD/CAD is mostly flat despite the strong pullback in precious metals markets. Gold declined below the psychologically important $4000 level, while silver tested strong support at $56.00. Other commodity-related currencies are losing some ground in today’s trading session.
Currently, USD/CAD is trying to settle below the support at 1.4010 – 1.4025. In case USD/CAD settles below the 1.4010 level, it will move towards the next support level at 1.3915 – 1.3930. RSI is close to the oversold territory, but there is enough room to gain additional downside momentum in the near term.
USD/JPY Gains Ground As Treasury Yields Rebound USD/JPY 160726 4h Chart USD/JPY is moving higher as traders react to the rebound in Treasury yields. The yield of 2-year Treasuries moved above the 4.17% level, while the yield of 10-year Treasuries climbed above 4.58%.
USD/JPY is moving towards multi-decade highs near the 162.80 level. In case USD/JPY manages to settle above 162.80, it will gain additional upside momentum and head towards the 165.00 level.
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Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.
GBP Talking Points: The British Pound retains relative strength, with GBP/USD setting a fresh monthly high yesterday, even as EUR/USD held lower-high resistance. GBP/JPY, however, has been in full breakout mode. I looked into this at the Tuesday webinar and the move has stretched all the way into a major Fibonacci level just below the 220 handle.
While USD bulls came back to life from mid-April through last month, GBP/USD has held up relatively well. The pair did test a fresh low in late-June but support held at a key Fibonacci level of 1.3143, and that’s where the music stopped for sellers and since then a strong bullish reversal has taken over that’s seen Cable rip for more than 400 pips into yesterday’s fresh monthly high.
This Fibonacci level carries some historical importance, as well, as the 38.2% retracement of the 2025 rally, and this came into play in August of that year to hold the lows with another instance of support, albeit messier, a couple months later.
GBP/USD Weekly Chart Chart prepared by James Stanley; data derived from Tradingview GBP/USD On a shorter-term basis prices are pulling back from the fresh high set yesterday, and the question now is when or where a higher-low might appear. The 1.3500 handle certainly seems to be playing a role but perhaps more interesting is a spot of prior resistance, down around 1.3450 that would be an ideal spot for buyers to defend. And then below that, the 1.3390 Fibonacci level up to the 1.3400 handle. And for an ‘s3’ support, there’s a prior swing-low turned swing-high that stands out around 1.3325.
GBP/USD Four-Hour Chart Chart prepared by James Stanley; data derived from Tradingview GBP/JPY I looked into GBP/JPY in the Tuesday webinar and at the time, the pair was set up in an ascending triangle formation. Buyers have since made a mark with a rally of more than 200 pips, and now we have price pushing into a longer-term Fibonacci level of note at 219.39 following the print of a fresh 18-year high.
GBP/JPY Monthly Chart Chart prepared by James Stanley; data derived from Tradingview Similar to albeit with more relative strength, we have the move pulling back in a short-term counter-trend dynamic. Given the veracity of the breakout, however, we’re also further away from any nearby possible swing points, as prior resistance is all the way down around 217.84 and for that to come into play we’d need a retracement of more than 100 pips from current market price. Ideally, for bullish continuation, buyers would remain more aggressive than that, and something like this is where Fibonacci can come into play as the recent rally has so far only given back 23.6% of the move.
The 38.2% retracement of that same move sets up as support potential, and this would be a more attractive area for bulls to show hints of topside continuation. From that same retracement, 218.41 and 218.04 would also be of interest.
GBP/JPY Two-Hour Price Chart Chart prepared by James Stanley; data derived from Tradingview --- written by James Stanley, Senior Market Analyst, Global Macro
GBP/USD remained supported after UK GDP returned to growth in May while softer US producer inflation weakened the US dollar. The British pound continues to draw support from improving economic data and expectations of fiscal stability under the incoming UK government. Markets are now focused on next week's UK inflation and employment reports for fresh direction in GBP/USD. The GBP/USD exchange rate held firm after fresh economic data showed the UK economy returned to modest growth while easing inflationary pressures in the United States reduced support for the US dollar.
The Office for National Statistics reported that the UK economy expanded 0.1% in May, matching market expectations and reversing April’s contraction. Although growth remains modest, the data suggests Britain’s economy continues to avoid a deeper slowdown despite elevated borrowing costs.
Meanwhile, the US dollar remained under pressure after June’s Producer Price Index (PPI) increased less than expected, reinforcing expectations that inflation is gradually cooling and reducing pressure on the Federal Reserve to tighten monetary policy aggressively.
UK GDP Growth Supports the British Pound Sterling found support after official data showed the UK economy returned to growth during May.
The monthly GDP report indicated that economic activity expanded by 0.1%, ending the previous month’s decline. While the pace of growth remains relatively slow, investors viewed the data as another sign that the UK economy continues to show resilience despite higher interest rates.
The positive GDP reading partially offset weaker industrial production figures, which contracted 0.5% during the month and highlighted ongoing challenges for Britain’s manufacturing sector.
For currency markets, however, the broader picture remains encouraging. Continued economic growth reduces concerns about a sharp slowdown and provides additional support for the pound.
Softer US Inflation Reduces Dollar Strength The US dollar eased after June’s Producer Price Index showed wholesale inflation slowed more than economists had expected.
The data followed a softer Consumer Price Index report earlier in the week, strengthening expectations that US inflation continues moving in the right direction.
Lower inflation reduces the likelihood of additional aggressive Federal Reserve rate increases, limiting one of the dollar’s biggest sources of support over the past two years.
Although the greenback continues to benefit from occasional safe-haven demand linked to geopolitical tensions, improving inflation data has encouraged investors to reassess the outlook for US interest rates.
That has helped GBP/USD remain well supported despite broader uncertainty across financial markets.
Political Stability Adds Support to Sterling Investor sentiment toward the pound has also improved following reports that incoming Prime Minister Andy Burnham is expected to appoint Shabana Mahmood as Chancellor. Financial markets generally view Mahmood as fiscally disciplined, reducing concerns over significant changes to government spending or borrowing.
Currency traders typically favour predictable fiscal policy because it improves confidence in long-term economic stability. While political developments remain secondary to interest rate expectations, they have provided an additional layer of support for sterling during the past week.
UK Inflation and Jobs Data Become the Next Major Catalyst Attention is now shifting to next week’s UK economic calendar. Investors will closely watch inflation and labour market reports for further clues about the Bank of England’s next policy decision.
Stronger-than-expected wage growth or persistent inflation could reinforce expectations that UK interest rates remain elevated for longer, providing additional support for the pound.
Conversely, weaker economic data may revive speculation that the Bank of England could begin easing policy sooner than markets currently anticipate. At the same time, traders will continue monitoring US economic releases and Federal Reserve commentary for fresh signals about the outlook for the dollar.
What This Means for GBP/USD The near-term outlook for GBP/USD remains closely tied to monetary policy expectations on both sides of the Atlantic.
The combination of improving UK economic growth, softer US inflation and expectations of fiscal stability has helped support sterling in recent sessions. However, the pair remains highly sensitive to incoming inflation data, central bank communication and broader global risk sentiment.
With both the Bank of England and the Federal Reserve adopting cautious policy stances, the next major economic releases could determine whether GBP/USD extends its recovery or returns to a more defensive footing.
Why is GBP/USD rising today?
GBP/USD is finding support after the UK economy returned to growth in May and softer US inflation data weakened the US dollar. Expectations that the Federal Reserve may take a more cautious approach to future interest rate decisions have also supported the currency pair.
How does UK GDP affect the British pound?
Stronger UK GDP growth generally supports the pound because it signals a healthier economy and can influence expectations for Bank of England interest rate policy. Higher growth often improves investor confidence in the UK economy.
What are traders watching next for GBP/USD?
Markets are focused on next week’s UK inflation and employment data, as well as upcoming Federal Reserve commentary. These events are expected to provide fresh clues about future interest rate decisions and could drive the next move in GBP/USD.
The GBP/USD pair attracts some sellers on Thursday and erodes a part of the previous day's strong gains to an over two-month high, around the 1.3555-1.3560 region. Spot prices stick to modest intraday losses around the 1.3525 zone through the first half of the European session, though the broader setup favors bullish traders and warrants caution before positioning for any further fall.
As investors digest this week's soft US Consumer Price Index (CPI) and Producer Price Index (PPI) reports, elevated crude oil prices revive energy-driven inflation fears and US Federal Reserve (Fed) rate hike expectations. This, along with escalating US-Iran tensions, offers some support to the safe-haven US Dollar (USD) and turns out to be a key factor exerting pressure on the GBP/USD pair.
The British Pound (GBP), on the other hand, might continue to draw support from easing UK political uncertainty and growing optimism over the UK's fiscal outlook. In fact, the incoming UK Prime Minister, Andy Burnham, has pledged to anchor his policy agenda on fiscal discipline and is expected to pick a fiscally conservative finance minister. This helps limit the downside for the GBP/USD pair.
From a technical perspective, the overnight breakout through the 61.8% Fibonacci retracement level of the May-June fall was seen as a fresh trigger for bulls against the backdrop of the recent repeated rebounds from the 1.3350 confluence. A subsequent strength beyond the 1.3500 psychological mark validates the constructive outlook for the GBP/USD pair and backs the case for further gains.
Moreover, the Moving Average Convergence Divergence (MACD) histogram is positive, and the line remains above zero. That said, the Relative Strength Index (RSI) at 72.2 signals overbought conditions that could slow the pace of gains rather than reverse the broader constructive tone. This makes it prudent to wait for some near-term consolidation or a modest pullback before the next leg up.
Meanwhile, immediate resistance is seen at the 78.6% Fibo. level at 1.3547, ahead of the recent cycle high, and at 1.3657, which would be the next target if bulls extend control. On the downside, initial support is located at the 61.8% retracement at 1.3461, followed by the 50.0% level at 1.3401. Deeper pullbacks would find a stronger demand around the 200-period SMA and the 38.2% level confluence at 1.3345-1.3340.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
GBP/USD 4-hour chart
Pound Sterling Price This week The table below shows the percentage change of British Pound (GBP) against listed major currencies this week. British Pound was the strongest against the Japanese Yen.
USDEURGBPJPYCADAUDNZDCHFUSD-0.55%-0.98%0.23%-0.81%-0.75%-1.53%-0.11%EUR0.55%-0.45%0.80%-0.27%-0.25%-0.99%0.45%GBP0.98%0.45%1.21%0.18%0.20%-0.54%0.95%JPY-0.23%-0.80%-1.21%-1.13%-0.98%-1.80%-0.39%CAD0.81%0.27%-0.18%1.13%0.15%-0.68%0.78%AUD0.75%0.25%-0.20%0.98%-0.15%-0.74%0.61%NZD1.53%0.99%0.54%1.80%0.68%0.74%1.50%CHF0.11%-0.45%-0.95%0.39%-0.78%-0.61%-1.50% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann note that GBP/USD has surged to a two‑month high, with deeply overbought conditions but scope for further gains. Intraday, upside is seen limited to a test of 1.3560 while holding above 1.3480. On a 1–3 week view, renewed momentum suggests the Pound has resumed its advance, with 1.3590 the level to monitor and strong support at 1.3450.
Overbought Pound still has upside scope"24-HOUR VIEW: We did not expect GBP to surge to a high of 1.3556 yesterday (we had expected range-trading). The sharp rally appears excessive, but with no sign of pause yet, GBP could continue to rise. However, given the deeply overbought conditions, any advance could be limited to a test of 1.3560. The major resistance at 1.3590 is unlikely to come under threat. To sustain the overbought momentum, GBP must not break below 1.3480 (minor support is at 1.3510)."
"1-3 WEEKS VIEW: Our most recent narrative was from Monday (13 Jul, spot at 1.3375), when we highlighted that “the GBP advance from late last month has ended.” We also highlighted that “for the time being, we expect GBP to trade in a range between 1.3320 and 1.3445.” In a sudden move yesterday, GBP lifted off and broke above 1.3445, surging to a high of 1.3556. The renewed upward momentum suggests that GBP has resumed its advance. That said, short-term conditions are deeply overbought, and the pace of any further advance is likely to be slower. The level to monitor is 1.3590. We will maintain a positive GBP stance as long as it holds above the ‘strong support’ level, currently at 1.3450."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
GBP/USD Jumps to Two-Month High on Chancellor Reports and Softer Fed Outlook GBP/USD has climbed to a two-month high above 1.35 as investors continue to scale back Federal Reserve rate hike expectations and welcome reports over the UK's next Chancellor.
Reports that Home Secretary Shabana Mahmood will be appointed Chancellor by incoming Prime Minister Andy Burnham have helped to reassure the market and ease concerns. The market had been fretting that Burnham could appoint a more fiscally expansionary candidate, such as Ed Miliband. UK government gilt yields are edging lower on the news.
Meanwhile, UK GDP data showed the economy returned to growth in May after contracting in April. GDP rose 0.1% month-on-month, beating expectations for no growth following April's 0.1% decline.
Looking beneath the headline, the services sector, which accounts for around 80% of the UK economy, expanded 0.3%. However, construction output fell 0.8%, while industrial production declined 0.5%, suggesting the recovery remains uneven.
Looking ahead, renewed tensions in the Middle East could cloud the outlook for the economy. Oil prices have risen to a monthly high, weighing on the economic outlook while increasing the risk of higher inflation
Higher oil prices are reinforcing expectations that the Bank of England will tighten monetary policy later this year. Markets are now fully pricing in a 25 basis point rate hike in November, with another increase expected in March 2027.
Meanwhile, the U.S. dollar has fallen to a monthly low after softer-than-expected CPI and PPI data this week, which followed last week's weaker labour market report. Together, the data have prompted investors to rule out a July rate hike from the Federal Reserve.
Markets now price around a 70% probability of a 25 basis point rate hike in September.
However, downside in the dollar could prove limited. Renewed U.S.-Iran hostilities could support safe-haven demand for the greenback, while rising oil prices risk reigniting inflation concerns and lifting Treasury yields.
Attention now turns to today's U.S. retail sales report, which is expected to show sales rose 0.2% month-on-month in June after 0.9% growth previously. A stronger-than-expected reading could lend support to the dollar.
GBP/USD Forecast – Technical Analysis
GBP/USD has recovered from the 1.3200 support zone, breaking above both the 200-day SMA and the multi-month falling trendline to reach a high of 1.3550.
The breakout, together with the RSI holding above 50, keeps the near-term technical outlook constructive.
Buyers will look to extend gains towards 1.3600, followed by 1.3650, the May high. A move above there would bring 1.3800 into focus.
Initial support is seen around 1.3500, where the former trendline resistance has become support. A break below this level would expose the 200-day SMA near 1.3400, followed by horizontal support at 1.3340. Below there, sellers could target the 1.3200 support zone.
Oil Steadies Near $80 as U.S.-Iran Hostilities Remain in Focus Oil prices are holding near a monthly high, with WTI trading around $80 per barrel, as renewed tensions between the U.S. and Iran continue to underpin the market.
The U.S. reimposed a naval blockade on Iranian ports earlier this week, while Tehran has threatened to disrupt more regional energy exports as tensions between the two sides continue to escalate.
Although geopolitical risks remain supportive of crude prices, the market has paused after the sharp rally earlier this week.
Shipping through the Strait of Hormuz remains well below normal levels, with just seven vessels transiting the waterway on Wednesday, down from 13 a day earlier.
At the same time, mediation efforts by neighbouring countries continue. The fact that oil prices have stabilised around current levels suggests investors are not yet pricing in a full-scale regional conflict.
However, a geopolitical risk premium remains firmly embedded in the market. Any signs that Iran could use its Houthi allies in Yemen to disrupt shipping through the Bab el-Mandeb Strait would likely add further upward pressure to oil prices.
Looking further ahead, oil prices could remain elevated into the fourth quarter if export flows continue to recover only slowly, particularly with global inventories already depleted following substantial drawdowns during the second quarter.
Conversely, a sustained easing in tensions alongside a faster recovery in production could see crude prices move back towards the $60 area by year-end.
Oil Forecast – Technical Analysis
After breaking below its symmetrical triangle pattern and the 200-day SMA, oil found support around $67 before staging a strong recovery.
The price has now reclaimed the 200-day SMA and is testing key resistance around $80, where the psychological level coincides with the April low and the 61.8% Fibonacci retracement of the move from $55 to $120.
With the RSI above 50, buyers will look for a break above $80, which would expose $88, where the 50-day SMA, the falling trendline resistance and the 50% Fibonacci retracement converge. Above there, $95 comes into focus.
Failure to overcome the 50-day SMA could see support tested around the 200-day SMA at $74.40. A break below there would shift attention back towards the $67-$70 support zone.
The Pound to Dollar (GBP/USD) exchange rate edged higher on Wednesday as investors continued to scale back Federal Reserve interest rate expectations following weaker-than-expected US inflation data.
At the time of writing, GBP/USD was trading around $1.3404, up modestly on the day.
Latest — Exchange Rates:
Pound to Dollar (GBP/USD): 1.349901 (+0.77%)
Euro to Dollar (EUR/USD): 1.143596 (+0.10%)
Dollar to Yen (USD/JPY): 162.14472 (-0.03%)
DAILY RECAP:
The US Dollar (USD) struggled to attract support through the start of Wednesday’s European session as it continued to be weighed down by Tuesday’s US consumer price index.
A clear USD selling bias emerged following the release of the CPI figures, as they reported US inflation slowed at a much faster-than-expected pace through June.
The data saw USD investors question whether the Fed will deliver a 25bps rate hike by the end of summer, with the odds of a hike at the end of this month tumbling from over 40% to just 14%.
USD investors were also positioned for further weakness in the US Dollar on Wednesday, with the publication of the latest US producer price index, which was expected to point to an easing of factory gate inflation.
Meanwhile, while supported against the US Dollar, the Pound (GBP) was mostly rangebound against its other peers on Wednesday.
In the absence of any notable UK economic indicators, Sterling sentiment was undermined by an uptick in UK bond yields, with the 10-year gilts trading close to a two-month high.
Rising borrowing costs remain a major burden on the UK economy, and GBP investors fear they will pose a major fiscal challenge for incoming Prime Minister Andy Burnham.
Near-Term GBP/USD Forecast: Rebound in UK GDP to Lift Sterling? Turning to the second half of the week, the next catalyst of movement for the Pound to US Dollar (GBP/USD) exchange rate will be the release of the UK’s latest GDP figures on Thursday.
Month-on-month growth is expected to have turned positive in May, with consensus estimates predicting GDP will tick up from –0.1% to 0.1%.
While the rebound could help underpin Sterling in the latter half of the session, the Pound’s upside potential may be capped if the data still points to growth being uneven.
Meanwhile, the US will publish its latest retail sales figures on Thursday.
US sales growth is forecast to have slowed sharply last month, which, coupled with an expected rise in jobless claims in the first week of July, could keep the pressure on the US Dollar.
Key Points:U.S. retail sales and jobless claims could significantly influence Fed rate expectations and the dollar's next move.Stronger economic data would reinforce the higher-for-longer interest rate outlook, supporting the U.S. dollar.DXY remains under pressure below key moving averages as traders watch whether support at 100.35 can hold.EUR/USD confirmed a bullish triangle breakout, putting the focus on resistance near the 1.1493 level.GBP/USD remains in a strong uptrend above key moving averages, with buyers targeting the 1.3560 resistance.
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US Dollar News: Retail Sales Test Fed Rate Outlook US dollar is driven today by June retail sales release as well as latest weekly jobless claims. These data releases provide the key drivers as to where we see the Fed heading next. Market participants expect retail sales to report a 0.3% monthly gain after May’s 0.9% decline, while weekly initial jobless claims are also expected to rise modestly to 217,500 from 215,000 last week. If the US sees stronger than expected readings in today’s retail sales releases, together with jobless claims continuing at the lowest levels in history, this will reinforce the notion of continued economic strength in the US economy, leading to higher US rates for longer.
The euro is back in focus as the market thinks that the ECB will keep deposit rate at 2.25% and also its stance is that of data dependent to deal with the inflationary risk. Sterling now seems to be pricing in the Bank of England keeping rates steady with Bank Rate unchanged at 3.75% after a 7 to 2 vote to keep rates steady in June while looking at inflation which stood at 2.8%, labor market conditions softening, and geopolitics being another headwind.
US Dollar Index Technical Analysis: Will DXY Recover From $100.35 or Extend Its Decline?
Dollar Index Price Chart – Source: Tradingview US Dollar Index (DXY) is hovering around 100.48 as it has fallen below both the 50-EMA (at 100.90) and 100-EMA (at 100.86), giving short-term sellers the upper hand. A few sharp red candlesticks sent the index below the descending trendline and the Fibonacci support levels, and it is currently hovering above the 0 level at 100.35. Resistance is at 100.61, then 100.77 and 100.89.
RSI at 38 reflects weakening momentum, which means the pair is in oversold territory, indicating that downside pressures are strong although short-term consolidation could take place. With this in mind, I would avoid any trades until an apparent recovery to the upside of 100.61 is seen, where I would anticipate a trade around 100.89, although the downside of 100.35 remains a threat.
GBP/USD Technical Analysis: Can Bulls Extend the Breakout Toward $1.3560? GBP/USD Price Chart – Source: Tradingview GBP/USD is currently trading at 1.3537, holding above the rising trendline after surpassing the previous swing high. The pair trades higher than the 50-EMA (at 1.3401) and 100-EMA (at 1.3368) as it is clear that buyers still are in a leading position. The recent green candlesticks pushed the pair higher to an intraday high of 1.3559 after minor consolidation, which I would consider as profit-taking rather than a signal of any major trend change.
The 0.236 Fibonacci level at 1.3507 represents support now, with the next level at 1.3475. Resistance levels are at 1.3560 and then 1.3638. RSI at 61 shows the pair remains comfortably bullish and far away from overbought, indicating the room for further bullish momentum remains intact. With this in mind, I would buy when price trades above 1.3507 and target profit at 1.3560, however, if the pair falls below 1.3475, then the pair may retest the support of 1.3449.
EUR/USD Technical Analysis: Is the Break Above Triangle Resistance Opening the Door to $1.1493? EUR/USD Price Chart – Source: Tradingview EUR/USD is trading near 1.1468 after breaking out of the trendline to the upside of a descending pattern that has formed a triangle shape and regained the 50-EMA (at 1.1428) and the 100-EMA (at 1.1437). The recent candlesticks have closed higher than the earlier resistance zone near 1.1461, indicating that buyers have stepped in after a period of sideways consolidation.
Resistance at 1.1493 is now in place, with 1.1461 as support initially and then 1.1412 after that. RSI at 61 shows the bullish bias is building strength, however, is not yet considered overbought. With this in mind, I would buy when price trades above 1.1461, aiming at taking profit around 1.1493. But if the pair drops below 1.1412, the pair will become less attractive as a buy.
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GBP/USD Price Forecast: Maintains constructive uptrend above 1.3500 despite mild lossesThe GBP/USD pair trades with mild losses around 1.3535 during the early European trading hours on Thursday. Markets might turn cautious ahead of the UK Gross Domestic Product (GDP) report and the US Retail Sales data, which are due later on Thursday.
Traders raise their bets on rate hikes from the Bank of England (BoE) this year, given the expected impact on inflation from higher oil prices. Money markets are fully pricing in a hike by the November policy meeting, with a second rate hike priced in by April 2027, according to Reuters. Prior to the US-Iran war, traders had been expecting the BoE to lower interest rates twice this year. Read more...
British Pound weakens below 1.3550 on renewed US strikes on IranThe GBP/USD pair declines to near 1.3530 during the early Asian session on Thursday. The British Pound (GBP) weakens against the US Dollar (USD) as renewed conflict and shipping disruptions in the Strait of Hormuz have reignited energy-driven inflation risks. Traders brace for the UK monthly Gross Domestic Product (GDP) report and the US Retail Sales data, which are due later on Thursday.
The US military said it has launched another wave of strikes against Iran in a further effort to keep the Strait of Hormuz open, per the Guardian. Explosions were reported late on Wednesday on Iran’s Qeshm Island, Bandar Abbas, and locations in the Sistan-Baluchestan province. Read more...
The British Pound Sterling breaks out on the strength of someone else's weaknessCable spent the London morning drifting, printed the session low at 1.3381 shortly after 10:00 GMT, and then spent the New York afternoon repricing the entire Dollar complex. The Pound trades near 1.3540 at writing, up better than 1% in one of its strongest sessions of the year, after tagging 1.3558 and clearing both the 200-day Exponential Moving Average (EMA) and the 1.3400 handle in a single afternoon. The move answers a month of indecision around those levels with the subtlety of a brick.
The significance here is structural rather than cosmetic. The 50-day and 200-day EMAs sit clustered at 1.3376 and 1.3385, and most of July's price action had been compressed between that band and the 1.3400 shelf, a coil that has now released in one direction. A single session does not repair a downtrend that ran from late April into early July, but it does shift the burden of proof onto Dollar bulls for the first time in months. Read more...
The GBP/USD pair trades with mild losses around 1.3535 during the early European trading hours on Thursday. Markets might turn cautious ahead of the UK Gross Domestic Product (GDP) report and the US Retail Sales data, which are due later on Thursday.
Traders raise their bets on rate hikes from the Bank of England (BoE) this year, given the expected impact on inflation from higher oil prices. Money markets are fully pricing in a hike by the November policy meeting, with a second rate hike priced in by April 2027, according to Reuters. Prior to the US-Iran war, traders had been expecting the BoE to lower interest rates twice this year.
Technical Analysis:In the daily chart, GBP/USD extends its advance above the 100-day simple moving average (SMA) and comfortably above the 20-day Bollinger middle band, which together reinforce a bullish near-term bias. The pair is now pressing the upper Bollinger band around 1.3534, suggesting a stretched but still constructive upswing, while the Relative Strength Index (14) at about 65 hints at firm bullish momentum that is edging toward overbought territory rather than outright exhaustion.
On the downside, immediate support is seen at the 100-day SMA at 1.3400, with the Bollinger middle band at 1.3325 providing a deeper cushion if a corrective pullback unfolds. A more pronounced decline would likely target the recent volatility floor around the lower Bollinger band near 1.3117. On the upside, the first upside barrier emerges at the May 8 high of 1.3637. Any follow-through buying above this level could pave the way to the 1.3700 psychological level.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Pound Sterling FAQs The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE).
The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects.
Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall.
Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
The British pound was the standout performer among the major currencies on Wednesday, buoyed by a weaker US dollar and growing optimism over the UK's fiscal outlook. Sterling rallied across the board, lifting GBP/USD to a nine-week high while GBP/AUD rebounded from support to challenge key long-term resistance.
View related analysis:
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Source: LSEG
Sterling Surges on Treasury Pick Speculation as GBP/USD and GBP/AUD Rally The British pound surged across the board on Wednesday following reports that incoming UK Prime Minister Andy Burnham is considering Shabana Mahmood for Finance Minister. While Mahmood has little direct economic policy experience, markets view her as a fiscally cautious choice. Her appointment would also reduce the likelihood of Ed Miliband becoming Chancellor, a candidate investors perceive as more likely to increase public spending, boost borrowing and pursue ambitious net-zero spending plans.
British Pound Breaks Higher Against the US Dollar GBP/USD rallied 1.2% to a nine-week high during its strongest session in four months, closing decisively above 1.3500. Sterling also drew support from a weaker US dollar, which fell for a second consecutive session and is now within striking distance of the psychologically important 100 level on the US Dollar Index.
The 1-hour chart shows how explosive the rally was, producing seven consecutive bullish candles during its 146-pip advance without a meaningful pullback. Prices are now consolidating in a tight range above the monthly R1 pivot (1.3521). However, after such a sharp move, the pair may be overstretched, with the RSI (14) in overbought territory, so bulls may want to be on guard for a minor pullback. The daily pivot point sits just below 1.3500, while the 15 June high aligns with the weekly S1 pivot (1.3461), providing a potential support zone.
With the US dollar retracing lower and GBP/USD maintaining its bullish momentum, buyers may be eyeing a move towards the monthly R2 pivot (1.3636), just below the May high.
Source: ICE, TradingView
GBP/AUD Bulls Eye Break Above Key Long-Term Resistance Earlier this week, I was working on the assumption that GBP/AUD could fall. Its three-week rally had been accompanied by waning momentum, while the previous two weekly candles formed long upper wicks, culminating in a shooting star reversal below the 200-day EMA. That view appeared to be playing out on Tuesday as the pair pulled back to its 20-day EMA, although Wednesday's bullish engulfing candle suggests the pullback may already be over.
March High Remains the Key Bullish Hurdle for GBP Bulls With a well-established uptrend and a potential swing low forming around the 12 June high and 20-day EMA, bulls may be preparing for another attempt to break above the 200-day and 200-week EMAs. This paints a bullish near-term picture heading into today's session, although there is also a reasonable chance of a shakeout around 1.9400 given the significance of the long-term moving averages and the March high.
Even so, unless a clear bearish catalyst emerges for the British pound, I suspect GBP bulls will look to buy any dips in anticipation of a bullish breakout above the March high. If they succeed, the 1.9595 high comes into focus for GBP/AUD.
Key Points:GBP/USD rallied as traders reacted to U.S. PPI data. USD/CAD moved lower despite the pullback in precious metals markets. USD/JPY was mostly flat as traders ignored falling Treasury yields.
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U.S. Dollar Pulls Back As PPI Misses Estimates
DXY 150726 4h Chart U.S. Dollar Index is moving lower as traders react to Producer Prices report. The report indicated that Producer Prices decreased by -0.3% month-over-month in June, compared to analyst forecast of 0%. Core PPI increased by +0.2%, while analysts forecasted that it would grow by +0.4%.
Today, traders also had a chance to take a look at the NY Empire State Manufacturing Index report. The report showed that NY Empire State Manufacturing Index improved from 5.70 in June to 15.60 in July, compared to analyst consensus of 8.8.
Currently, U.S. Dollar Index is trying to settle below the support level at 100.50 – 100.65. In case this attempt is successful, U.S. Dollar Index will move towards the next support, which is located in the 99.75 – 99.90 range.
EUR/USD Remains Stuck Near The 1.1435 Level EUR/USD 150726 4h Chart EUR/USD is moving higher despite the weaker-than-expected Industrial Production report. The report indicated that Industrial Production decreased by -0.2% month-over-month in May, compared to analyst forecast of +0.2%.
The technical picture remains unchanged as EUR/USD is stuck near the resistance level at 1.1420 – 1.1435. If EUR/USD manages to settle above the 1.1435 level, it will head towards the resistance at 1.1500 – 1.1515.
GBP/USD Tests New Highs GBP/USD 150726 4h Chart GBP/USD rallied as traders reacted to the softer-than-expected U.S. PPI data and remained focused on U.S. CPI report, which was released yesterday.
GBP/USD climbed above the resistance level at 1.3450 – 1.3465 and is trying to settle above the 1.3500 level. In case this attempt is successful, GBP/USD will move towards the next resistance, which is located in the 1.3535 – 1.3550 range. It should be noted that RSI has moved into overbought territory, so the risks of a pullback are increasing.
USD/CAD 150726 4h Chart USD/CAD is moving lower despite the pullback in precious metals markets. Gold declined below the $4050 level, while silver settled below $57.00. Other commodity-related currencies are also moving higher in today’s trading session.
The nearest support level for USD/CAD is located in the 1.4010 – 1.4025 range. A successful test of this level will open the way to the test of the next support at 1.3915 – 1.3930. RSI is in the oversold territory, but there is some room to gain additional downside momentum in the near term.
On the upside, a move above the 1.4080 level will push USD/CAD towards the resistance level at 1.4125 – 1.4140.
USD/JPY Is Flat As Traders Ignore Falling Treasury Yields USD/JPY 150726 4h Chart USD/JPY is mostly flat despite the pullback in Treasury yields. The yield of 2-year Treasuries declined below the 4.15% level, while the yield of 10-year Treasuries settled near 4.55%.
Traders stay bullish due to the ultra-dovish policy of the Bank of Japan. The market believes that BoJ cannot raise rates without putting too much pressure on the Japanese economy.
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Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.
The Pound Sterling rises by some 0.60% against the US Dollar after the latest Producer Price Index (PPI) in the US showed prices edging lower, driven by the dip in energy prices since late May. At the time of writing, the GBP/USD trades at 1.3460 after bouncing off a daily low of 1.3370. Read More...
British Pound dips below 1.3400, turns negative on the day as US Dollar picks upThe British Pound (GBP) has retraced previous gains against the US Dollar (USD) on Wednesday, returning to the 1.3390 area from session highs of 1.3420 and turning negative on the daily chart. The safe-haven US Dollar has bounced up during the London session amid the risk-averse sentiment as US and Iran escalate their threats following the resumption of hostilities. Read More...
British Pound advances as US Dollar remains subdued following inflation dataGBP/USD rises for the second consecutive day, trading around 1.3400 during the Asian hours on Wednesday. The pair appreciates as the US Dollar (USD) holds losses following softer-than-expected US inflation data, fueling hopes that the US Federal Reserve (Fed) might adopt a less hawkish monetary stance. Read More...
British Pound Technical Outlook: GBP/USD Short-Term Trade Levels GBP/USD is attempting to break above a multi-month downtrend with bulls testing pivotal resistance at the yearly open today. A daily close above resistance would strengthen the case that a more significant low is in place and invalidate the May downtrend. Failure to sustain the breakout would keep the broader downtrend intact / threaten resumption. U.S. retail sales and Michigan confidence on tap into the close of the week- UK employment / CPI next week. Resistance 1.3460/74 (key), 1.3509, 1.3591/93- Support 1.3397, 1.3302/26 (key), 1.3187/94 GBP/USD is attempting to complete its most significant technical breakout in months after a 2.6% recovery off the yearly lows carried Sterling back into a major resistance zone defined by the yearly open and key Fibonacci retracement levels. The latest advance has improved the near-term technical outlook, but buyers still need confirmation above this pivotal barrier to invalidate the broader May downtrend. With the weekly opening-range already breaking to the upside, attention now turns to whether Sterling can build on this momentum and confirm a more durable trend reversal. Battle lines drawn on the GBP/USD short-term technical charts.
Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Sterling technical setup and more. Join live on Monday’s at 8:30am EST.
British Pound Price Chart – GBP/USD Daily
Chart Prepared by Michael Boutros, Sr. Technical Strategist; GBP/USD on TradingView
Technical Outlook: In last month’s British Pound Short-term Outlook, we noted that GBP/USD had rebounded off downtrend support and that, “From a trading standpoint, rallies would need to be limited to 1.3326 IF price is heading lower on this stretch with a close below 1.3187 needed to fuel the next leg of the decline.” Sterling marked a six-day rally off the lows into the monthly cross with the advance extending nearly 2.4% off the June low. The rally exhausted into downtrend resistance last week with price straddling the 200-day moving average for the past five-days. The weekly opening range breaking today and the focus is on a reaction into the objective yearly open with a close above needed to keep the immediate advance viable and fuel the next leg higher.
British Pound Price Chart – GBP/USD 240min
Chart Prepared by Michael Boutros, Sr. Technical Strategist; GBP/USD on TradingView
Notes: A closer look at Sterling price action shows GBP/USD trading within the confines of an embedded ascending pitchfork extending off the May lows. Sterling is testing a major pivot zone today at 1.3460/74- a region defined by the 61.8% retracement of the May decline, the February low-day close (LDC), and the objective 2026 yearly open. A breach / daily close above this threshold is needed to invalidate the multi-month downtrend and suggest a more significant low is in place. Subsequent resistance is eyed at the May 25th swing high at 1.3509 with the next major technical consideration eyed at the 61.8% retracement of the yearly range and the 2025 May & August swing highs at 1.3591/93. Look for larger reaction there IF reached.
Initial support rests with the May low / low close 1.3302/26. Note that the 75% parallel of the downslope converges on this level into the close of the week and losses below this threshold would validate a break of the multi-week uptrend and threaten resumption of the broader May downtrend. Subsequent support rests with the 61.8% retracement at 1.3260 and the March low close / 38.2% retracement of the 2025 advance at 1.3187/94.
Bottom line: Sterling is attempting to breakout of a multi-month downtrend with a breakout of the weekly opening-range supporting the rally today. From a trading standpoint, losses would need to be limited to the 200-day moving average near ~1.3397 IF price is heading higher on this stretch with daily close above 1.3474 needed to fuel the next leg of the advance.
Keep in mind we get still get the release of U.S. retail sales and Michigan consumer sentiment into the close of the week. Key U.K. data hits next week with the May employment report and the consumer price index (CPI)on tap. Stay nimble into the release and watch the weekly close here for directional guidance. Review my latest British Pound Weekly Forecast for a closer look at the longer-term GBP/USD technical trade levels.
Key GBP/USD Economic Data Releases
Active Short-term Technical Charts
US Dollar Short-term Outlook: USD Uptrend Faces Make-or-Break Test After CPI Euro Short-term Outlook: EUR/USD Coils Above Critical Support- Decision Time Gold Price Short-term Outlook: XAU/USD Bulls Try to Carve Out a Low After 30% Drop Canadian Dollar Short-term Outlook: USD/CAD Coils Below Resistance—Breakout Looms Australian Dollar Outlook: AUD/USD Holds Major Support—Reversal Risk Builds Swiss Franc Short-term Outlook: USD/CHF Overbought Rally Tests Major Resistance Japanese Yen Short-term Outlook: USD/JPY Breakout Stalls at 2024 High as Intervention Risk Builds --- Written by Michael Boutros, Senior Technical Strategist
The British Pound (GBP) is up 0.1% at around 1.3403 against the US Dollar (USD) during the European trading session on Wednesday. The GBP/USD pair gains as the US Dollar comes under selling pressure, with market participants dialing down expectations for Federal Reserve (Fed) interest rate hikes.
In the European trade, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, has recovered its early losses and is marginally down to near 100.87. However, the DXY is still holding Tuesday’s losses. Read more...
GBP/USD awaits political news: What will happen nextGBP/USD rose to 1.3403 on Wednesday, with British politics taking centre stage for investors.
The market is assessing the upcoming change of prime minister, with Andy Burnham set to take office on 20 July. Of additional interest is the potential candidate for the new Chancellor of the Exchequer. In betting markets, Ed Miliband is considered the favourite, whom investors perceive as a supporter of more active fiscal spending. Read more...
The British Pound (GBP) is up 0.1% at around 1.3403 against the US Dollar (USD) during the European trading session on Wednesday. The GBP/USD pair gains as the US Dollar comes under selling pressure, with market participants dialing down expectations for Federal Reserve (Fed) interest rate hikes.
In the European trade, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, has recovered its early losses and is marginally down to near 100.87. However, the DXY is still holding Tuesday’s losses.
According to the CME FedWatch tool, the odds of the Fed raising interest rates in the policy meeting this month have eased to 16.6% from 41.7% recorded on Monday.
Traders pare hawkish Fed bets as the United States (US) Consumer Price Index (CPI) report for June showed on Tuesday that both headline and core inflation grew at a slower-than-expected pace.
In the United Kingdom (UK), Andy Burnham is set to replace Prime Minister (PM) Keir Starmer on July 20 and will likely appoint a new Finance Minister (FM). The smooth UK leadership transition is supporting the British Pound.
GBP/USD technical analysis
GBP/USD trades slightly higher at around 1.3400, holding a mildly bullish near‑term bias as it remains above the 20‑period exponential moving average (EMA) at 1.3350. However, the overall trend appears sideways amid the Descending Triangle formation.
The Relative Strength Index (RSI) at 55.93 suggests steady, but not overextended, upside momentum.
On the downside, initial support is seen at the current price area around 1.3401, with the 20‑period EMA at 1.3350 reinforcing a nearby demand zone before the structural floor defined by the rising trend‑line break near 1.3166. On the topside, a sustained move above 1.3520, where the descending resistance trend line break level resides, would be needed to open the door for a more decisive bullish extension beyond the recent range. Above 1.3520, the pair could extend its advance towards 1.3600.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Inflation FAQs Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%.
The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls.
Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money.
Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
GBP/USD rose to 1.3403 on Wednesday, with British politics taking centre stage for investors.
The market is assessing the upcoming change of prime minister, with Andy Burnham set to take office on 20 July. Of additional interest is the potential candidate for the new Chancellor of the Exchequer. In betting markets, Ed Miliband is considered the favourite, whom investors perceive as a supporter of more active fiscal spending.
At the same time, market participants are monitoring escalating tensions in the Middle East, rising oil prices, and increased inflation risks. The United States has continued its strikes on Iran following Donald Trump’s restoration of a naval blockade on Iranian shipping and his proposal for a 20% fee to cover the costs of securing the Strait of Hormuz.
Against this backdrop, markets have strengthened expectations of further rate hikes from the Bank of England. Investors are now almost fully pricing in two rate increases in 2026, with a September hike already largely reflected in quotes.
In the US, weaker-than-expected inflation data for June has eased pressure on the Federal Reserve. However, Christopher Waller warned that the regulator could tighten policy again if inflation remains above the 2% target.
Technical Analysis
On the H4 GBP/USD chart, the market is shaping a growth wave towards 1.3451. A wide consolidation range is practically forming around the 1.3393 level. An upside breakout from this range would open potential for the wave to continue to 1.3453. A downside breakout would suggest the potential for the wave to continue to 1.3333, with the prospect of the trend extending to 1.3090. Technically, this scenario is confirmed by the MACD indicator, whose signal line is above the zero level and pointing strictly downwards.
On the H1 chart, the market has formed a compact consolidation range around the 1.3400 level, currently extending down to 1.3370. An increase to 1.3451 is expected, followed by a decline to 1.3330. Technically, this scenario is confirmed by the Stochastic oscillator, with its signal line below the 80 level and pointing strictly downwards to 20.
Conclusion GBP/USD has edged higher as markets focus on the upcoming UK political transition, with Andy Burnham set to become prime minister on 20 July. The potential appointment of Ed Miliband as Chancellor-seen as favouring more active fiscal spending-adds an element of intrigue. Meanwhile, geopolitical tensions in the Middle East, including renewed US strikes on Iran and a proposed 20% fee for securing the Strait of Hormuz, have pushed oil prices higher and reinforced Bank of England tightening expectations. Markets are now pricing in two rate hikes for 2026, with September already priced in. In the US, softer inflation data has eased pressure on the Fed, though officials remain vigilant. Technically, the pound may see further upside towards 1.3451 before a potential pullback, with the broader direction hinging on UK political developments and geopolitical risks.
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US Dollar News: Softer Inflation Reshapes Fed Outlook The evolving monetary policies, particularly with the release of June’s inflation numbers in the United States, are causing shifts in the value of the dollar, sterling and the euro. U.S. annual inflation for July fell to 3.5% from June’s 4.2%, with core inflation also falling, to 2.6%. This caused a rapid decrease in the projected likelihood of a July 28-29 Federal Reserve interest rate hike. Demand for U.S. futures implied only a 10% likelihood of a July hike. Earlier estimates placed U.S. interest rate hikes at a 35% probability, indicating the bulk of interest rate conjecture has moved to September.
The euro has risen in value with speculation that the European Central Bank will keep the deposit rate at 2.25% and also Curb inflation and growth in the euro region.
The pound also remains strong as it is expected the Bank of England will continue to err on the side of caution. U.K. inflation has also been little influenced by renewed Middle Eastern conflict. Governor Andrew Bailey remains focused on other economic data.
US Dollar Index Technical Analysis: Is DXY Building Momentum for a Move Toward $101.22? Dollar Index Price Chart – Source: Tradingview The US Dollar Index (DXY) is hovering around the 100.88 mark, consolidating above the 0.50 Fibonacci retracement at $100.59 and the 50 EMA at $100.23. The 100 EMA at $99.66 is helping the uptrend. The last few DXY candlesticks display small bodies showing consolidation below $101.22, right after the bullish breakout from the previous descending triangle. $100.88 is the 0.382 Fibonacci level and is providing immediate support, while resistance sits at $101.22 and $101.79 respectively.
The RSI is at approximately 53, above the midpoint, and is showing a decrease in bullish momentum, but the uptrend is still there. As long as we observe DXY above $100.59, we can expect another attempt to reach $101.22, but if that fails, we may see $99.85.
GBP/USD Technical Analysis: Can the Rising Channel Extend the Rally Above $1.3450? GBP/USD Price Chart – Source: Tradingview GBP/USD is currently trading around 1.3405 and stays well within the confines of a rising channel on the 4 hour time frame. Price is above both the 50 EMA at 1.3370 and the 100 EMA at 1.3340 indicates that traders are still dominating the buying side of the market. Recent rejections of the 1.3400 support level have resulted in the formation of higher lows along the rising channel line. The most immediate resistance is found at 1.3453, while 1.3508 is a secondary resistance level.
The most significant support level is at 1.3342. The RSI is at 56 and indicates a bullish market, while the RSI is not at the overbought zone. Based on this market analysis I will be looking for buying opportunities above the 1.3400 level, the target being 1.3453 and with a break below the 1.3342 level the buy side market structure will be broken and this will be an indication of potential reversal in the market.
EUR/USD Technical Analysis: Will the Symmetrical Triangle Trigger the Next Breakout? EUR/USD Price Chart – Source: Tradingview EUR/USD is priced at 1.1423 and is forming a symmetrical triangle on the 4-H chart. The price is around the 50 EMA at 1.1420 but is below the 100 EMA at 1.1435. This shows that buyers and sellers have not taken control of the market. The latest candlesticks show small bodies and long wicks suggesting indecision as the triangle’s apex is approached.
The first nearby resistance is at 1.1461, and the first nearby support is at 1.1412, then 1.1379. The RSI is at 51 and shows no market pressure, which supports consolidation. Given this analysis, I would prefer to see a confirmed breakout beyond 1.1461 with targets set at 1.1493. However, if the price closed below 1.1412, the target would be 1.1379.
United Overseas Bank’s Quek Ser Leang and Lee Sue Ann highlight that GBP/USD’s late-month advance has stalled, with the pair rebounding to 1.3442 before closing at 1.3387. Intraday, the British Pound (GBP) is expected to trade between 1.3360 and 1.3430. Over 1-3 weeks, they maintain a neutral stance, looking for range-trading between 1.3320 and 1.3445, while longer-term supports sit at 1.3210 and 1.3160.
Pound-Dollar trapped in sideways band"24-HOUR VIEW: After GBP declined as we expected two days ago, we highlighted yesterday that “there is scope for GBP to dip below 1.3340 and test 1.3320.” We added, “to keep the momentum going, GBP must hold below 1.3390.” Our view was incorrect, as after dipping to a low of 1.3346, GBP jumped during the NY session, reaching a high of 1.3442. GBP pulled back sharply from the high to close at 1.3387 (+0.31%). Despite the sharp advance, there has been no clear increase in upward momentum. The current price movements are likely part of a range-trading phase, probably between 1.3360 and 1.3430."
"1-3 WEEKS VIEW: Two days ago (13 Jul, spot at 1.3375), we highlighted that “the GBP advance from late last month has ended.” We added, “for the time being, we expect GBP to trade in a range between 1.3320 and 1.3445.” Although GBP rose near the top of our expected range yesterday with a high of 1.3442, it retreated quickly from the high. There has been no shift in momentum indicators, and we continue to expect GBP to trade in a range between 1.3320 and 1.3445."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
The Pound to Dollar (GBP/USD) exchange rate rallied on Tuesday after softer-than-expected US inflation data prompted investors to scale back expectations for another Federal Reserve interest rate hike.
At the time of writing, GBP/USD was trading around $1.3411, up approximately 0.5% on the day.
Latest — Exchange Rates:
Pound to Dollar (GBP/USD): 1.338178 (+0.24%)
Euro to Dollar (EUR/USD): 1.142849 (+0.40%)
Dollar to Yen (USD/JPY): 162.13999 (-0.17%)
DAILY RECAP:
A clear US Dollar (USD) selling bias emerged on Tuesday after the latest US consumer price index showed inflationary pressures eased by more than expected last month.
June's Consumer Price Index reported that headline inflation slowed from 4.2% to 3.5% year-on-year, comfortably below forecasts for a more modest easing to 3.8%. Core inflation also undershot expectations, with annual core CPI easing to 2.6%.
In response, financial markets trimmed some of their more hawkish policy expectations for the Federal Reserve, with the odds for a September interest rate hike falling from around 70% to 50%.
Meanwhile, the Pound (GBP) found support during Tuesday's session as investors doubled down on bets that the Bank of England (BoE) will have to raise borrowing costs again.
The hawkish shift in market sentiment stems from a fresh spike in global energy markets. With conflict flaring up once more in the Gulf, the vital Strait of Hormuz shipping lane has been blocked, raising fears of a renewed inflation shock that could force the BoE’s hand before 2026 draws to a close.
Even so, Sterling's rally was tempered by cautious commentary from the head of the BoE.
Appearing before the Treasury Select Committee, BoE Governor Andrew Bailey struck a sober tone. He pointed out that the geopolitical unrest in the Middle East poses a serious threat to financial stability, while simultaneously reminding lawmakers that Britain's sluggish economic growth remains a heavy drag on the domestic outlook.
Near-Term GBP/USD Forecast: US Producer Prices in Focus Looking ahead, the next catalyst of movement for the Pound to US Dollar (GBP/USD) exchange rate will be the publication of the latest US producer price index on Wednesday.
A cooling in factory gate prices could weigh on the ‘Greenback’ in midweek trade, as we could see a further trimming of Fed rate-hike bets if there are further signs that US inflationary pressures are easing.
Meanwhile, movement in the Pound looks set to remain limited on Wednesday amid a lull in UK data ahead of Thursday’s GDP release.
British Pound advances as US Dollar remains subdued following inflation dataGBP/USD rises for the second consecutive day, trading around 1.3400 during the Asian hours on Wednesday. The pair appreciates as the US Dollar (USD) holds losses following softer-than-expected US inflation data, fueling hopes that the US Federal Reserve (Fed) might adopt a less hawkish monetary stance.
The US Consumer Price Index (CPI) inflation eased to 3.5% year-over-year in June, dropping from a three-year high of 4.2% in May and coming in well below the market consensus of 3.8%. On a monthly basis, headline CPI actually declined by 0.4% in June, a notable shift from the 0.5% increase recorded in May. Read more...
British Pound gains traction above 1.3400 as softer US CPI dampens Fed rate hike expectationsThe GBP/USD pair gains ground to near 1.3405 during the early Asian session on Wednesday. The US dollar (USD) weakens against the British Pound (GBP) as softer-than-expected US inflation in June tempered expectations for US Federal Reserve (Fed) policy tightening. The release of the US June Producer Price Index (PPI) report will be in the spotlight later in the day.
US inflation slowed more than expected in June, with the US Consumer Price Index (CPI) rising by 3.5% YoY in June, compared to 4.2% in May, the US Bureau of Labor Statistics (BLS) showed on Tuesday. This figure came in cooler than the expectation of 3.8%. On a monthly basis, the headline CPI declined by 0.4% in June, versus a rise of 0.5% prior. Read more...
The softest US inflation print in six years buys British Pound Sterling about four hoursCable trades just beneath the 1.3400 handle late in Tuesday's session, pinned under a 200-day Exponential Moving Average (EMA) that sits a few pips shy of the figure and has capped every recovery attempt for two weeks. The softest US inflation report in six years landed at 12:30 GMT; the pair spiked to within a few pips of 1.3450 and has since handed the entire move back.
Tuesday's rejection carries more weight than one headline normally earns: the bounce from early July's trough near 1.3150 has run directly into the falling 200-day average, the daily Stochastic Relative Strength Index is stretched above 80, and Sterling must now explain why the best inflation news the Dollar could hand it was worth roughly four hours of gains. Read more...
GBP/USD started a fresh increase above 1.3300 and 1.3350. A key bullish trend line is forming with support at 1.3370 on the 4-hour chart. Gold struggled near $4,120 and corrected some gains. WTI Crude Oil prices gained pace for a move above $80.00. GBP/USD Technical Analysis The British Pound remained in a positive zone above 1.3320 against the US Dollar. GBP/USD corrected some gains from 1.3450, but the bulls protected losses.
Looking at the 4-hour chart, the pair tested the 38.2% Fibonacci retracement level of the upward move from the 1.3140 swing low to the 1.3451 high. Besides, the pair remained stable above the 100 simple moving average (red, 4-hour) and the 200 simple moving average (green, 4-hour).
The pair is again rising above 1.3400. On the upside, the bears might remain active near 1.3435 and 1.3450. The next major resistance might be 1.3500.
A close above 1.3500 could start a steady increase. In the stated case, the bulls could aim for a move to 1.3620. If there is a fresh decline, the pair might find support near 1.3370. There is also a key bullish trend line forming with support at 1.3370.
The first major support could be near 1.3300 and the 100 simple moving average (red, 4-hour). A downside break and close below 1.3300 might send the pair toward the 50% Fibonacci retracement level at 1.3260. Any more losses could open the doors for a test of 1.3200.
Looking at EUR/USD, the pair recovered some losses, but the bears are still active near the 1.1475 resistance zone.
Upcoming Key Economic Events:
US Producer Price Index for June 2026 (MoM) – Forecast 0%, versus +1.1% previous. US Producer Price Index for June 2026 (YoY) – Forecast +6.2%, versus +6.5% previous. Fed’s Cook speech. Fed’s Beige Book.
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The British Pound (GBP) strengthens against the US Dollar (USD) on Tuesday after US inflation data surprised to the downside, reducing expectations of a near-term Federal Reserve (Fed) interest rate hike. At the time of writing, GBP/USD trades around 1.3415, up nearly 0.50% on the day and hovering near a one-month high. Read More...
GBP/USD Price Forecast: Pound holds above 1.3350 with the 200-day SMA capping gainsThe British Pound (GBP) appreciates against the US Dollar (USD) on Tuesday to trim previous losses and return to the 1.3375 area, aiming to retest resistance at the key 200-day Simple Moving Average (SMA). This is a popular indicator, which lies a few pips below 1.3400 and has been capping Pound’s recovery over the last two weeks. Read More...
British Pound drifts higher to near 1.3350 ahead US CPI dataThe GBP/USD pair gains ground to around 1.3355 during the early European trading hours on Tuesday. The British Pound (GBP) strengthens against the US Dollar (USD) as traders have ramped up bets that the Bank of England (BoE) will be forced to raise interest rates this year to keep inflation under control. Read More...
U.S. Dollar Pulls Back As Inflation Rate Misses Estimates
DXY 140726 4h Chart U.S. Dollar Index is losing ground as traders react to CPI report. The report indicated that Inflation Rate decreased from 4.2% in May to 3.5% in June, compared to analyst forecast of +3.8%. Core Inflation Rate pulled back from 2.9% to 2.6%, while analysts expected that it would drop to 2.8%.
Lower-than-expected inflation data put material pressure on the American currency as traders reduced bets on hawkish Fed. However, the strong rally in the oil markets may raise prices again, so it remains to be seen whether the pullback in inflation is sustainable.
The nearest support level for U.S. Dollar Index is located in the 100.50 – 100.65 range. In case U.S. Dollar Index manages to settle below the 100.50 level, it will head towards the next support, which is located in the 99.75 – 99.90 range.
EUR/USD Tests Resistance At 1.1420 – 1.1435 EUR/USD 140726 4h Chart EUR/USD moved higher as traders focused on U.S. inflation data. In the EU, traders had a chance to take a look at the Wholesale Prices report from Germany. The report indicated that Wholesale Prices declined by -0.7% month-over-month in June, compared to analyst forecast of +0.5%.
From the technical point of view, EUR/USD continues its attempts to settle above the resistance level at 1.1420 – 1.1435. In case EUR/USD climbs above the 1.1435 level, it will head towards the next resistance at 1.1500 – 1.1515. RSI remains in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.
GBP/USD Moves Higher As Traders Reduce Bets On Hawkish Fed GBP/USD 140726 4h Chart GBP/USD gained ground, supported by U.S. CPI report. Traders bet that Fed will be less hawkish as inflation has started to calm down. Traders also focus on comments from Fed Chair Warsh. He said that CPI decline did not mean that Fed accomplished its mission.
In case GBP/USD pulls back below the 50 MA at 1.3376, it will head towards the nearest support level at 1.3335 – 1.3350. A successful test of of this level will open the way to the test of the next support at 1.3250 – 1.3265.
On the upside, GBP/USD needs to settle above the resistance at 1.3450 – 1.3465 to have a chance to gain additional upside momentum in the near term.
USD/CAD Tests New Lows
USD/CAD 140726 4h Chart USD/CAD is losing ground as lower-than-expected U.S. CPI data provided material support to commodity markets. Other commodity-related currencies are also moving higher in today’s trading session.
USD/CAD settled below the previous support at 1.4125 – 1.4140 and is trying to settle below the 1.4050 level. In case this attempt is successful, it will head towards the next support at 1.4000 – 1.4025.
USD/JPY Moves Lower As Treasury Yields Fall USD/JPY 140726 4h Chart USD/JPY is losing some ground as traders focus on the pullback in Treasury yields. The yield of 2-year Treasuries declined towards the 4.20% level, while the yield of 10-year Treasuries settled below 4.60%.
A move below the support level at 161.50 – 162.00 will push USD/JPY towards recent lows near the 160.50 level. It should be noted that USD/JPY failed to gain strong downside momentum as traders worried that rising oil prices will put pressure on Japan’s economy.
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/ / British Pound Technical Outlook: GBP/USD Recovery Vulnerable at Major Resistance GBP/USD is approaching major resistance early in the month - can the bulls charge the break?
14/07/2026
7/14/2026 12:23:00 PM
British Pound Technical Outlook: GBP/USD Multi-Timeframe Analysis British pound, GBP/USD and U.S. inflation are back in focus as Sterling struggles to extend its recovery. Michael Boutros, Senior Market Analyst at FOREX.com, examines the key technical levels that could determine the next move for GBP/USD, explains why resistance remains intact, and discusses how upcoming U.S. CPI, PPI and retail sales data could shape the outlook for the U.S. dollar and Sterling in the days ahead.
This content was created by an affiliate of FOREX.com and represents the views and opinions of the author/speakers, not the views and opinions of Forex.com, StoneX Group Inc., or its subsidiaries. The content has not been independently reviewed by FOREX.com.
Key US Economic Data Releases
Economic Calendar - latest economic developments and upcoming event risk.
Active Short-term Technical Charts Euro Short-term Outlook: EUR/USD Coils Above Critical Support- Decision Time Gold Price Short-term Outlook: XAU/USD Bulls Try to Carve Out a Low After 30% Drop Canadian Dollar Short-term Outlook: USD/CAD Coils Below Resistance—Breakout Looms Australian Dollar Outlook: AUD/USD Holds Major Support—Reversal Risk Builds Swiss Franc Short-term Outlook: USD/CHF Overbought Rally Tests Major Resistance Japanese Yen Short-term Outlook: USD/JPY Breakout Stalls at 2024 High as Intervention Risk Builds British Pound Short-term Outlook: GBP/USD Rebound Challenges Bear Trend Written by Michael Boutros, Senior Technical Strategist
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The British Pound (GBP) appreciates against the US Dollar (USD) on Tuesday to trim previous losses and return to the 1.3375 area, aiming to retest resistance at the key 200-day Simple Moving Average (SMA). This is a popular indicator, which lies a few pips below 1.3400 and has been capping Pound’s recovery over the last two weeks.
Markets are hesitant on Tuesday with the US Dollar a tad lower as investors await the release of US Consumer Prices Index (CPI) figures, which are expected to show a slight moderation in prices, yet at levels well above the Federal Reserve’s (Fed) 2% rate. After that Fed Chairman Kevin Warsh will face the first of the two hearings before the US Congress scheduled for this week.
The Pound has been holding a positive trend since Prime Minister Keir Starmer resigned in late June. Investors are confident that Andrew Burnham, the best-positioned candidate to replace him, will respect Chancellor Reeves' fiscal rules.
Technical Analysis: Key resistance is at the 1.3400 area
GBP/USD trades at 1.3378. The pair broke the downtrend resistance line from May highs but remains capped below the 200-day simple moving average (SMA) at 1.3397. Momentum indicators in the daily chart are neutral-to-bullish with the Relative Strength Index (RSI) hovering just above 50 and the Moving Average Convergence Divergence (MACD) in positive territory.
The mentioned 200-day SMA around 1.3397, however, is likely to be a tough nut to crack. If that level is broken, the June 15 and July 10 high, near 1.3455, will be targeted. On the downside, the floor of the last two weeks' trading range, at 1.3330, is likely to challenge bears. Further down, the broken trendline, now at 1.3290, and the June 22 and 30 highs around 1.3270 emerge as the next targets.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Pound Sterling Price Today The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the US Dollar.
USDEURGBPJPYCADAUDNZDCHFUSD-0.18%-0.26%-0.18%-0.52%-0.50%-0.97%-0.35%EUR0.18%-0.08%0.02%-0.35%-0.33%-0.79%-0.17%GBP0.26%0.08%0.11%-0.25%-0.23%-0.71%-0.09%JPY0.18%-0.02%-0.11%-0.35%-0.35%-0.82%-0.21%CAD0.52%0.35%0.25%0.35%0.00%-0.45%0.17%AUD0.50%0.33%0.23%0.35%-0.01%-0.47%0.18%NZD0.97%0.79%0.71%0.82%0.45%0.47%0.62%CHF0.35%0.17%0.09%0.21%-0.17%-0.18%-0.62% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
The Pound to Dollar (GBP/USD) exchange rate dipped at the start of the week as renewed tensions in the Middle East briefly boosted demand for the safe-haven US Dollar before Sterling recovered some ground.
At the time of writing, GBP/USD was trading at $1.3391, having rebounded from an overnight low of $1.3369.
Latest — Exchange Rates:
Pound to Dollar (GBP/USD): 1.337846 (-0.20%)
Euro to Dollar (EUR/USD): 1.13997 (-0.13%)
Dollar to Yen (USD/JPY): 162.32053 (+0.38%)
DAILY RECAP:
The US Dollar (USD) initially rose as this week’s trade began, following fresh clashes in the Middle East.
Although fighting briefly subsided on Friday, tensions flared again over the weekend after Iran targeted a container vessel in the Strait of Hormuz. The US responded with strikes against Iranian positions, prompting Tehran to retaliate by launching attacks on US-aligned Gulf states.
Investors are becoming increasingly wary that the conflict could escalate further, dampening hopes that the two sides could negotiate a lasting peace agreement.
A risk-off mood as trade began on Monday lifted the safe-haven US Dollar, although USD struggled to hold its gains as market risk sentiment showed some resilience.
Meanwhile, the Pound (GBP) traded without clear direction on Monday as the absence of any notable UK economic releases offered investors little impetus.
However, Sterling managed to limit losses against the US Dollar, supported by continued optimism over the UK's political outlook. Investors remained hopeful that the prolonged period of political uncertainty weighing on the Pound was beginning to fade.
This helped GBP recoup some of its initial losses against USD.
Near-Term GBP/USD Forecast: US Inflation to Dent the US Dollar? Looking forward, the ‘Greenback’ could face headwinds on Tuesday with the publication of the latest US consumer price index.
Markets expect inflation to have cooled from 4.2% in May to 3.8% in June. If the CPI prints as forecast, USD could come under pressure.
However, events in the Middle East are also likely to drive movement. The ‘Greenback’ could enjoy safe-haven flows if tensions remain fraught.
Meanwhile, GBP investors will focus on a speech from Bank of England (BoE) Governor Andrew Bailey on Tuesday.
Bailey has recently maintained a measured stance, suggesting policymakers should monitor inflation developments before making any changes to interest rates. However, with renewed US-Iran tensions pushing global energy prices higher, Sterling could strengthen if his remarks signal a firmer commitment to keeping monetary policy restrictive.
United Overseas Bank’s Quek Ser Leang and Lee Sue Ann highlight that GBP/USD gapped lower, dropping to 1.3343 and closing at 1.3346 as the Dollar firmed. Short‑term momentum has cooled, but they still see scope for a dip toward 1.3320, while the broader view has turned neutral, with Sterling expected to trade between 1.3320 and 1.3445 in coming sessions.
Sterling shifts to neutral range view"24-HOUR VIEW: GBP closed at 1.3402 last Friday, but it gapped lower on the open yesterday. When it was at 1.3375, we indicated that “the rapid increase in momentum suggests GBP could break below 1.3360.” We also indicated that “the next support at 1.3340 is likely out of reach.” We were not wrong, as GBP broke below 1.3360 and dropped to a low of 1.3343. Despite the decline, downward momentum has not increased significantly. However, there is scope for GBP to dip below 1.3340 and test 1.3320. Based on the prevailing momentum, a clear break below 1.3320 appears unlikely. To keep the momentum going, GBP must hold below 1.3390, with minor resistance at 1.3375"
"1-3 WEEKS VIEW: Yesterday (13 Jul, spot at 1.3375), we revised our view from positive to neutral. We highlighted that “the GBP advance from late last month has ended.” We added, “for the time being, we expect GBP to trade in a range between 1.3320 and 1.3445.” While we did not quite expect the subsequent sharp decline to 1.3343, we will continue to hold the same view for now. Looking ahead, should GBP break below 1.3320, it could trigger a deeper pullback."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
British Pound strengthens above 1.3350 ahead of US CPI dataThe GBP/USD pair trades in positive territory around 1.3360 during the Asian trading hours on Tuesday. However, the potential upside for the major pair might be limited amid fears of an escalating US-Iran conflict. The US June Consumer Price Index (CPI) inflation report will take center stage later on Tuesday.
US President Donald Trump said on Monday that Washington was reinstating a naval blockade on Tehran and would ensure the Strait of Hormuz remained open for a fee following fresh exchanges of missile and drone strikes, per Reuters. The US military said that US forces completed new strikes on Iranian military targets, adding that more than 50,000 US service members are currently deployed across the Middle East. Read more...
British Pound Sterling buckles as Trump builds the Hormuz toll booth he swore would never existThe British Pound Sterling is spending Monday learning the difference between a recovery and a reprieve. GBP/USD opened the week flush against its 200-day Exponential Moving Average (EMA), probed the 1.3400 area through the Asian hours, and has been sold methodically ever since; the pair now changes hands at 1.3349, leaning on the 1.3350 shelf with the session low a few pips beneath.
Little of the damage is native to Sterling, because the Dollar is being bought against the entire major-currency board on two stories that landed within hours of each other. The first turns the world's most important Crude Oil chokepoint into a toll plaza; the second comes from a Federal Reserve (Fed) official who spent last year arguing for cuts and now warns about hikes. Read more...
Dollar Index Price Chart – Source: Tradingview DXY holds $101.20, with the daily chart showing mixed candlestick retesting of the Fibonacci 0.618 level at $100.31 after a strong breakout from the $97.67 swing low. Bullish candles are making higher highs with the price staying above the 50-period EMA at $100.21, signaling buyers’ control.
The RSI, though still near neutral at 60, is biased to the upside. The volume profile is also showing $101.00 to 101.50 as the breakout zone. In the coming weeks, the technical analysis suggests a target near $103.09.
Since the price is holding above $100.31, the technical structure remains strongly bullish. As the chart is in an uptrend, the price is making higher highs and higher lows in a channel. My plan is to buy above $101.20 targeting $103.09, with a stop loss at $100.31.
The Pound Sterling begins the week on a lower note, as over-the-weekend developments in the Middle East fueled inflationary pressures due to the rise in Oil prices. At the time of writing, the GBP/USD trades at 1.3369, down over 0.20%. Read More...
British Pound remains subdued as US-Iran tensions lift US DollarGBP/USD remains in negative territory after paring daily losses, trading around 1.3390 during the early European hours on Monday. The pair faces challenges as the US Dollar (USD) gains ground on rising safe-haven demand amid intensifying tensions in the Middle East. Read More...
British Pound remains depressed below 1.3400 as escalating US-Iran tensions underpin USDThe GBP/USD pair finds some support near 1.3370 after a modest gap-down opening on Monday, though it lacks bullish conviction and remains below 1.3400. Nevertheless, spot prices, for now, seem to have stalled the pullback from a nearly four-week high, around the 1.3450 area, touched on Friday amid mixed fundamental cues. Read More...
Key Points:EUR/USD pulled back as traders reacted to the strong rally in the oil markets. USD/CAD was mostly flat as traders focused on the pullback in precious metals markets. USD/JPY climbed towards the 162.50 level amid rising Treasury yields.
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U.S. Dollar Gains Ground As Oil Prices Rally
DXY 130726 4h Chart U.S. Dollar Index gains ground as traders focus on geopolitical developments. President Trump said that U.S. will impose a naval blockade on Iranian ports. He added that U.S. will become a “guardian” in the Strait of Hormuz and would charge fees at a rate of 20% on all cargo shipped.
Currently, U.S. Dollar Index is trying to settle above the resistance level at 101.15 – 101.30. In case this attempt is successful, U.S. Dollar Index will move towards the next resistance level, which is located in the 101.80 – 101.95 range.
EUR/USD Retreats As Traders Bet On Hawkish Fed
EUR/USD 130726 4h Chart EUR/USD pulled back as traders focused on the strong rally in the oil markets. Brent oil gained 5% as the flow of oil through the Strait of Hormuz would drop after U.S. decision to impose a naval blockade on Iran. Most likely, Iran will try to attack vessels passing through the Strait without the country’s permission.
EUR/USD failed to settle above the resistance at 1.1420 – 1.1435 and pulled back towards the 1.1400 level. If EUR/USD manages to settle below the 1.1400 level, it will head towards the nearest support, which is located in the 1.1350 – 1.1365 range. RSI is in the moderate territory, so there is plenty of room to gain additional downside momentum in case the right catalysts emerge.
GBP/USD Pulls Back Amid Rising Geopolitical Tensions GBP/USD 130726 4h Chart GBP/USD moved lower as traders worried that rising oil prices will force the Fed to raise rates sooner rather than later, which would be bullish for the American currency.
In case GBP/USD declines below the 50 MA at 1.3366, it will get to the test of the support at 1.3335 – 1.3350. A move below the 1.3335 level will open the way to the test of the next support level at 1.3250 – 1.3265.
USD/CAD Remains Stuck Near Support At 1.4125 – 1.4140 USD/CAD 130726 4h Chart USD/CAD continued its attempts to settle below the support at 1.4125 – 1.4140 despite the strong pullback in precious metals markets. Gold declined towards the psychologically important $4000 level, while silver pulled back below $58.00. Other commodity-related currencies were mixed in today’s trading session.
If USD/CAD settles below the 1.4125 level, it will move towards the support level at 1.4010 – 1.4025. On the upside, USD/CAD needs to stay above the 1.4140 level to have a chance to gain upside momentum in the near term. In this case, USD/CAD will head towards the 50 MA at 1.4185. A move above the 50 MA will push USD/CAD towards the resistance at 1.4225 – 1.4240.
USD/JPY Gains Ground As Treasury Yields Rise
USD/JPY 130726 4h Chart USD/JPY is moving higher as traders focus on rising Treasury yields. The yield of 2-year Treasuries moved above the 4.25% level, while the yield of 10-year Treasuries settled above 4.60%.
If USD/JPY stays above the support level at 161.50 – 162.00, it will move towards recent highs near the 162.80 level. In case USD/JPY manages to settle above 162.80, it will gain additional upside momentum and head towards the 165.00 level. It remains to be seen whether Bank of Japan is ready to provide support to the Japanese yen.
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Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.
GBP/USD Price Forecast: Bounces back to near 1.3400 as US Dollar turns upside downThe British Pound (GBP) recovers its early losses and flattens around 1.3400 against the US Dollar (USD) during the European trading session on Monday. The GBP/USD pair bounces back as the US Dollar surrenders its opening gains and turns negative amid hopes that renewed hostilities between the United States (US) and Iran won’t be prolonged.
In the late European trade, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades 0.1% lower at around 100.85. Read more...
British Pound remains subdued as US-Iran tensions lift US DollarGBP/USD remains in negative territory after paring daily losses, trading around 1.3390 during the early European hours on Monday. The pair faces challenges as the US Dollar (USD) gains ground on rising safe-haven demand amid intensifying tensions in the Middle East.
US Central Command (CENTCOM) launched additional airstrikes on Sunday evening, following striking more than 300 Iranian targets over a three-night span, including 140 on Saturday. The purpose is to neutralize Iran's capability to target civilian vessels navigating critical waterways. This military escalation has left Washington and Tehran issuing conflicting declarations regarding whether the strategic strait remains open to maritime traffic. Read more...
British Pound remains depressed below 1.3400 as escalating US-Iran tensions underpin USDThe GBP/USD pair finds some support near 1.3370 after a modest gap-down opening on Monday, though it lacks bullish conviction and remains below 1.3400. Nevertheless, spot prices, for now, seem to have stalled the pullback from a nearly four-week high, around the 1.3450 area, touched on Friday amid mixed fundamental cues.
Former Greater Manchester mayor Andy Burnham secured the support of the vast majority of Labour MPs to replace Keir Starmer and become Britain's next prime minister, calming concerns about political instability. This, along with bets for at least one 25-basis-point (bps) interest rate hike from the Bank of England by the end of 2026, lends some support to the British Pound (GBP). However, escalating US-Iran tensions benefit the safe-haven US Dollar (USD) and might keep a lid on any further upside for the GBP/USD pair. Read more...
The British Pound (GBP) recovers its early losses and flattens around 1.3400 against the US Dollar (USD) during the European trading session on Monday. The GBP/USD pair bounces back as the US Dollar surrenders its opening gains and turns negative amid hopes that renewed hostilities between the United States (US) and Iran won’t be prolonged.
In the late European trade, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades 0.1% lower at around 100.85.
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the weakest against the New Zealand Dollar.
USDEURGBPJPYCADAUDNZDCHFUSD-0.10%0.09%0.26%-0.16%0.14%-0.34%0.07%EUR0.10%0.20%0.35%-0.06%0.25%-0.20%0.19%GBP-0.09%-0.20%0.17%-0.25%0.08%-0.38%0.04%JPY-0.26%-0.35%-0.17%-0.43%-0.13%-0.58%-0.14%CAD0.16%0.06%0.25%0.43%0.31%-0.12%0.29%AUD-0.14%-0.25%-0.08%0.13%-0.31%-0.41%0.00%NZD0.34%0.20%0.38%0.58%0.12%0.41%0.43%CHF-0.07%-0.19%-0.04%0.14%-0.29%-0.01%-0.43% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
During the day, a spokesperson from the Iranian Foreign Ministry confirmed that efforts from Qatar, Oman and Pakistan to mediate tensions with the United States (US) are continuing, while accusing Washington of violating the memorandum of understanding (MoU) terms.
Meanwhile, military aggression between the US and Iran continues as Iran's Mehr News Agency stated during the European trade that several explosions were heard around Iran's Bandar Abbas and Qeshm island. However, the news has not been confirmed by major media outlets.
Going forward, investors will focus on the US Consumer Price Index (CPI) data for June and the United Kingdom (UK) monthly Gross Domestic Product (GDP) data for May, which are scheduled for Tuesday and Thursday, respectively.
GBP/USD technical analysis
GBP/USD trades calmly near 1.3400. The pair holds a modest bullish bias as spot trades above the 20-day exponential moving average (EMA) at 1.3344, but the overall trend appears sideways amid the Descending Triangle formation.
The Relative Strength Index (RSI) at roughly 55 leans to the topside but remains shy of overbought territory, hinting at constructive yet not overstretched momentum.
On the topside, initial resistance emerges at the downward resistance trend line break price near 1.3528, and a daily close above this barrier would open the way for a more sustained advance. On the downside, immediate support is provided by the 20-day EMA at 1.3344, and a drop back below this moving average would ease the current bullish tone and expose deeper pullbacks toward the June 30 low at 1.3212.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Economic Indicator Gross Domestic Product (MoM) The Gross Domestic Product (GDP), released by the Office for National Statistics on a monthly and quarterly basis, is a measure of the total value of all goods and services produced in the UK during a given period. The GDP is considered as the main measure of UK economic activity. The MoM reading compares economic activity in the reference month to the previous month. Generally, a rise in this indicator is bullish for the Pound Sterling (GBP), while a low reading is seen as bearish.
The GBP/USD pair retreated from a multi-week peak of 1.3452 toward following a sudden flare-up of US-Iran conflict The escalating geopolitical risk revived global safe-haven demand for the US dollar and pushed crude oil prices sharply higher While near-term technicals point to range-bound consolidation, the medium-term path remains tied to UK GDP growth and central bank divergence. The GBP/USD pair reached a high of approximately 1.3452 last week, its strongest performance since mid-June, driven by increased economic optimism in the UK. However, this upward trend paused at the start of the new trading week.
Geopolitical tensions between the United States and Iran, specifically concerning shipping lanes in the Middle East, caused a significant market reaction. This led to a decline in the GBP/USD pair, bringing it back to around 1.3383 and raising concerns about the durability of sterling’s recent gains.
How Did We Get Here? Sterling’s upward movement last week was primarily influenced by expectations regarding the Bank of England’s monetary policy. Market participants have factored in at least one interest rate increase anticipated for later in 2026, with a possibility of a second, reflecting ongoing inflation concerns. Additionally, political transitions, including the recent resignation of Keir Starmer and the expected leadership of Andy Burnham, contributed to a more stable market sentiment.
However, market sentiment has recently shifted. The weekend saw significant missile and drone exchanges between US and Iranian forces. Reports indicate that Iran launched attacks on American installations in the Gulf and potentially closed the Strait of Hormuz.
This development led to a jump in Brent crude prices of around 3-4% as trading commenced in Asia. According to Reuters, this combination of rising oil prices and inflation fears, coupled with a move towards safe-haven assets, strengthened the US dollar globally.
During periods of heightened military tension, the US dollar typically serves as a primary safe-haven asset. This often prompts institutional investors and corporate treasuries to quickly reallocate capital away from riskier assets and into more liquid U.S. Treasury securities.
The Dollar Has The Upper Hand In The Near-Term In the near term, the GBP/USD exchange rate will probably see some selling, and the pair will likely be range-bound. While the geopolitical situation is causing some choppiness now, it probably won’t change the overall direction for the long term. Typically, during these kinds of crises, investors flock to the dollar for safety. However, this effect usually doesn’t last if tensions ease or talks begin again.
Looking further ahead, though, this conflict probably won’t drastically change the bigger economic picture. The British pound is in a stronger position than it was in past years. The UK economy has shown consistently positive surprises in its data, and the upcoming GDP numbers are expected to show a good recovery.
How Should Investors Position Themselves? Investors should be careful right now. If you hold British pound assets, you might want to consider protecting yourself against the dollar getting stronger, perhaps by using options or spreading out your currency holdings.
For traders, a more sensible move is to see dips as opportunities to buy rather than signs of a major downturn. While at it, be sure to pay close attention to the Consumer Price Index (CPI) report coming out on Tuesday. Also, keep an eye out for any indications that the Strait of Hormuz might be disrupted for a long time, as that would be a real threat to this outlook.
Currencies Reflect Divergent Monetary Policies and Economic Fundamentals On July 13, the dollar, euro and pound will keep being defined by competing central bank stances and economic fundamentals. Latest FOMC meeting minutes saw a hint of a shift towards the hawkish side with some officials thinking rates might well be firmed up on the back of core inflation being too sticky, while risks from energy price volatility, and demand from artificial intelligence. The dollar is thus supported by the prospect of relatively restrictive monetary policy being sustained for a period of time. Strong underlying domestic demand and a status quo as a global reserve currency are key structural positives for the dollar.
Economy-wide growth across the euro zone is currently uneven, and is likely to remain so in the months following the ECB’s June rate increase to 2.25%. Different fiscal positions at the country level and heterogeneous inflation dynamics are key factors influencing monetary policy transmission in the euro zone. The euro currency remains susceptible to activity and wage data.
Sterling is facing a similar dilemma, as policymakers at the Bank of England juggle elevated service-sector inflation risks against signs of softer economic growth. Domestic fiscal and labour market policies are likely to continue playing a key role in the currency’s outlook as relative policy stances with the Fed and the ECB impact on exchange rates.
Key economic fundamentals remain divergent, with different paths in inflation dynamics, fiscal settings and underlying growth resilience, all of which will sustain two-way market risks for the three major currencies. External trade flows and capital movements will further differentiate the currency markets depending on which central bank can most easily maintain stability and growth.
DXY Holds $101.07 – Fib 0.618 Retest on 4h Dollar Index Price Chart – Source: Tradingview The USD index (DXY) was up slightly at $101.07 on the 4h timeframe chart. We can see from the 4h DXY chart that the mixed candles had just tested 0.618 Fib level near 100.31 after a strong breakout from the swing low at 97.67.
The bullish bodies with higher highs are confirming the buyer’s control, while still maintaining respect for the 4h chart 50-EMA near 101.02. We can also observe that the RSI sits near 55. Meanwhile, the volume profile identifies 100.59-101.06 as a significant breakout point.
Fib retracement implies the next resistance will come around 103.09 in the next few weeks. In short, the market remains decisively bullish in the 4h chart above 100.59 inside a well-defined ascending channel, confirming a higher high and a higher low formation to keep the buyers firmly in control.
Based on this technical outlook, I would consider a long position around $101.07, targeting $103.09, while placing a stop below $100.59.
GBP/USD Holds $1.3388 – EMA 50 Defense on 4h
GBP/USD Price Chart – Source: Tradingview The British pound was trading near $1.3388 on the 4h timeframe chart. The mixed candles defending the 4h chart 50-EMA near 1.3360 were kicked off near the red MA around 1.337, according to the 4h GBP/USD price chart.
The bullish wicks represent buyers’ absorption around support levels, confirming higher lows are still in tact. The RSI sits near 51. The volume profile identifies 1.331-1.338 as a reliable pivot. We note that the resistance is located around 1.345-1.350.
The GBP/USD is maintaining a neutral-to-bearish structure at the 4h 1.345 EMA-50 as the price oscillates inside a sideways trading range. The higher lows indicate that the buyers remain on the sidelines, looking to buy at any pullback.
Based on the current technical outlook, I would consider a long position around 1.3388, targeting 1.345, with a stop below 1.325.
EUR/USD Holds $1.1440 – EMA 50 Defense on 4h EUR/USD Price Chart – Source: Tradingview The euro (EURUSD) was trading near $1.1440 on the 4h timeframe chart. The 4h EUR/USD chart shows that the mixed candles are defending the 4h chart 50-EMA near $1.1423 after the bears were kicked off near the $1.162 red MA. We see that the bullish wicks represent buyers’ absorption near support levels while the higher lows are being held on the 4h EUR/USD.
The RSI sits near 43. The volume profile confirms a reliable pivot around 1.140-1.150. The next resistance is located around 1.155-1.162. The EUR/USD price action remains neutral-bearish near the 1.150 EMA-50 on the 4h timeframe chart as the price trades inside the long-term downtrend. Higher lows keep the buyers engaged, as they enter at any dips in this zone.
Based on the current technical outlook, I would consider a long position around 1.1440, targeting 1.155, with a stop below 1.140.
UOB’s Quek Ser Leang and Lee Sue Ann note that GBP/USD gapped lower after briefly breaking above 1.3445, with momentum turning down and risks of a test below 1.3360, though 1.3320 is seen as distant for now. They judge that the advance from late last month has ended and expects a 1.3320–1.3445 range in coming weeks, with broader 1.3210–1.3655 levels on a 1–3 month view.
Pound advance seen losing steam"24-HOUR VIEW: Last Friday, when GBP was at 1.3410, we indicated that “there is a chance for GBP to test the major resistance at 1.3445.” However, we were of the view that “a clear break above this level is unlikely.” We added, “support is at 1.3390.” While GBP rose more than expected to 1.3452, it then staged a sharp retreat to 1.3392 before closing largely unchanged at 1.3402 (-0.05%). Today, GBP gapped lower on the open. The rapid increase in momentum suggests GBP could break below 1.3360. The next support at 1.3320 is likely out of reach. Resistance is at 1.3390; a breach of 1.3410 would mean the immediate downward pressure has faded."
"1-3 WEEKS VIEW: We have held a positive GBP view since late last month (see annotations in the chart below). Last Thursday (09 Jul, spot at 1.3390), we highlighted that “while the risk remains on the upside, given that there has been no further increase in upward momentum, it is left to be seen if GBP can reach 1.3445.” After GBP rose to 1.3430, we highlighted on Friday (10 Jul, spot at 1.3410) that “upward momentum has strengthened somewhat, and should GBP break above 1.3445, the next level to watch is 1.3480.” The subsequent price movements did not quite turn out as expected. GBP broke above 1.3445 and printed a high of 1.3452 before dropping sharply. It continued to decline today. Although our ‘strong support’ level at 1.3360 has not been breached yet, upward momentum has largely faded. To put it another way, the GBP advance from late last month has ended, and for the time being, we expect GBP to trade in a range between 1.3320 and 1.3445."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
The Pound to Dollar (GBP/USD) exchange rate climbed over the past week, briefly reaching a three-week high as Sterling remained well supported despite renewed geopolitical tensions in the Middle East.
At the time of writing, GBP/USD was trading at $1.3417, up around 0.5% on the week.
Latest — Exchange Rates:
Pound to Dollar (GBP/USD): 1.338855 (-0.13%)
Euro to Dollar (EUR/USD): 1.140619 (-0.08%)
Dollar to Yen (USD/JPY): 161.71495 (+0.01%)
DAILY RECAP:
The US Dollar (USD) traded unevenly last week as renewed tensions in the Middle East created periods of safe-haven demand, although the currency struggled to hold onto its gains for long.
The 'Greenback' opened the week on a mixed footing, briefly finding support as US markets reopened after the Independence Day holiday before retreating as improving risk appetite reduced demand for the safe-haven currency.
Fresh attacks on commercial shipping in the Strait of Hormuz then boosted USD on Tuesday, as fears of a wider regional conflict prompted investors to seek safer assets.
However, the US Dollar lost momentum in the second half of the week. Despite escalating US-Iran tensions, resilient market sentiment limited demand for the safe-haven currency, while the Federal Reserve's latest meeting minutes offered little fresh policy guidance.
USD briefly fell to a three-week low against the Pound on Friday, although it recovered some ground before the close as trading remained volatile.
Meanwhile, the Pound (GBP) continued to strengthen over the past week as traders further reduced the political risk premium attached to Sterling following Prime Minister Keir Starmer’s resignation three weeks ago.
Sterling’s strong performance highlights the extent to which prolonged political uncertainty had been holding back the UK currency. With Andy Burnham now widely expected to replace Starmer through a smooth transition of power, confidence in the UK’s political outlook has continued to improve, providing additional support for the Pound.
The Pound also benefited from rising expectations that the Bank of England (BoE) will increase interest rates. Escalating tensions in the Middle East pushed oil prices higher, leading markets to price in a greater chance of another BoE rate hike.
Near-Term GBP/USD Forecast: UK GDP and US CPI in Focus Looking ahead, the spotlight for Pound investors this week will be Thursday’s UK GDP release. Economists expect the British economy to have returned to growth in May, with a modest 0.1% expansion forecast, which may provide Sterling with some support.
That said, the GDP figures are only likely to trigger a more pronounced reaction if they come in notably above or below expectations, potentially prompting sharp moves in the Pound.
Politics may also remain on investors’ radar. Andy Burnham could be officially confirmed as Labour leader on Friday if no other valid candidates enter the race. A smooth and orderly handover is likely to be viewed positively by markets, which could offer additional support to Sterling.
Meanwhile, the focus for USD investors will be the latest US consumer price index on Tuesday. If inflation cooled in June, as expected, the ‘Greenback’ could drop.
That said, fresh tensions in the Middle East could sour the market mood and lift USD.
Cable moves within a narrow-range sideways mode for the second consecutive day, after 1% advance last week that completed reversal pattern on weekly chart (after the downleg from 1.3869 was contained by ascending trendline, drawn off 1.0348, 2022 low) and generated positive signal on close above weekly Ichimoku cloud top (1.3335).
On the other side, the picture on daily chart is not that optimistic (14-d momentum remains in negative territory and turns south, stochastic is emerging from overbought territory) as long upper shadows on last two daily candles point to strong headwinds from very significant 1.3400 resistance zone (consisting of converged 200/100/55DMAs / 50% retracement of 1.3653/1.3140 / daily cloud base).
The second consecutive daily Doji candle signals strong indecision and risk of further hesitation and possible recovery stall on approach to pivotal 1.3400 resistance zone.
More likely scenario in the near term would be dips towards 1.3300 zone (psychological / 20DMA) which needs to contain dips and keep in play hopes for fresh acceleration higher and possible attack at 1.3400 zone barriers.
Conversely, firm break of 1.3300 handle would further weaken near-term structure and risk deeper drop.
The information contained in this document was obtained from sources believed to be reliable, but its accuracy or completeness cannot be guaranteed. Any opinions expressed herein are in good faith, but are subject to change without notice. No liability accepted whatsoever for any direct or consequential loss arising from the use of this document.
The Pound Sterling (GBP) holds firm on Friday during the North American session as risk appetite deteriorated after US President Donald Trump posted on social media that the ceasefire with Iran is over, even though negotiations continue. At the time of writing, the GBP/USD pair trades at 1.3406, unchanged, after reaching an almost one-month high of 1.3451 earlier in the day. Read More...
British Pound surrenders early gains as US Dollar regains groundThe British Pound (GBP) gives back its early gains and turns almost flat around 1.3410 against the US Dollar (USD) during the European trading session on Friday. The GBP/USD pair falls back as the US Dollar regains ground amid fears that the restart of the war between the United States (US) and Iran would last long. Read More...
British Pound gains traction above 1.3400 as markets bet on BoE rate hikesThe GBP/USD pair gathers strength to around 1.3430 during the Asian trading hours on Friday. The British Pound (GBP) edges higher against the US Dollar (USD) on the UK government leadership transition and growing expectations of further Bank of England (BoE) interest rate hikes. Read More...
GBP/USD 100726 4h Chart GBP/USD is moving higher as traders bet that the situation in the Middle East will calm down. In absence of economic reports, geopolitical developments serve as the key catalyst for GBP/USD. In case U.S. and Iran restart negotiations and do not attack each other, demand for risk assets will increase, providing additional support to the British pound.
The nearest resistance level for GBP/USD is located in the 1.3450 – 1.3465 range. If GBP/USD manages to settle above the 1.3465 level, it will head towards the next resistance level, which is located in the 1.3535 – 1.3550 range.
On the support side, GBP/USD needs to settle below the 1.3400 level to have a chance to gain downside momentum in the near term. A move below 1.3400 will push GBP/USD towards the support level at 1.3335 – 1.3350.
British Pound Technical Forecast: GBP/USD Weekly Trade Levels GBP/USD has nearly erased the latest decline after rebounding sharply from key support at the yearly low. The recovery is once again approaching the same resistance zone that rejected Sterling last month - the near-term advance remains vulnerable while below. A sustained breakout would invalidate the recent downtrend and strengthen the case for a larger trend reversal while failure would keep the broader range intact. U.S. inflation data next week could provide the catalyst for the next major move in Sterling. Resistance 1.3460/74 (key), 1.3591, 1.3648/85- Support 1.3326, 1.3194/99 (key), 1.3092 The battle for control of GBP/USD is shifting back to a familiar battleground. After recovering sharply from support at the yearly lows, Sterling is once again confronting the yearly open and a major Fibonacci resistance zone that rejected price just weeks ago. The coming sessions should help determine whether buyers can finally force a meaningful breakout or if this latest recovery proves to be another counter-trend rally within the broader range. With U.S. inflation data looming next week, the macro backdrop may provide the catalyst for the next major move. Battle lines drawn on the GBP/USD weekly technical chart.
Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Sterling setup and more. Join live on Monday’s at 8:30am EST.
British Pound Price Chart – GBP/USD Weekly
Chart Prepared by Michael Boutros, Sr. Technical Strategist; GBP/USD on TradingView
Technical Outlook: In last month’s British Pound Weekly Forecast we noted that the Sterling recovery had stretched into pivotal resistance at the 2026 yearly open, “and marks the first test for the bulls.” GBP/USD reversed sharply off resistance later that week with the decline extending more than 2.5% off the June highs. Price rebounded into the close of the month off lateral support at the 38.2% retracement of the 2025 advance with a two-week rally nearly erasing the entire decline. Sterling is once again trading into pivotal resistance at the 61.8% retracement of the May decline and the objective yearly open at 1.3460/73. The focus is on possible inflection off this threshold with the multi-week advance vulnerable while below.
Initial weekly support rests with the May low close at 1.3326 and is backed by the 38.2% retracement and the 2026 low-week close (LWC) at 1.3194/99. Note that a break / weekly close below this threshold would constitute a breakout of the yearly opening range and threaten the next major leg of the decline. Subsequent support rests with the 2026 high-week close (HWC) at 1.3092.
A breach / weekly close above this key pivot zone would invalidate the May downtrend and fuel a larger recovery within the yearly range. The next technical considerations beyond this level are eyed with the 61.8% retracement of the yearly range at 1.3591 and the 2025 & 2026 high week closes (HWC) at 1.3648/84- look for a larger reaction there IF reached.
Bottom line: The Sterling rally is now approaching pivotal Fibonacci resistance into the yearly open- risk for price inflection into this zone in the weeks ahead. Watch the weekly close today with respect to the 52-week moving average (currently ~1.3406) for guidance. From a trading standpoint, a good zone to reduce long-exposure / raise protective stops – the immediate focus is on a breakout of the 1.3326-1.3474 range for guidance with the near-term long-bias vulnerable below the yearly open.
The UK economic docket is rather light over the next few days with the U.S. June CPI & PPI data highlighting event risk next week. Stay nimble into the releases and respect the weekly close. Review my latest British Pound Short-term Outlook for a closer look at the near-term GBP/USD technical trade levels.
GBP/USD Economic Data Releases
Economic Calendar - latest economic developments and upcoming event risk.
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The euro has also been struggling to navigate mixed economic activity throughout the Eurozone, and in addition, the ECB is trying to achieve price stability. As countries continue to have varying fiscal positions and inflation rates, they are impacting the way that monetary policy affects each country differently. For the euro, that translates into being vulnerable to data releases on economic activity and wage increases.
Sterling faces the same challenge of balancing between the Bank of England’s concerns over services inflation and the economy’s slowing pace. In the UK, there continues to be domestic fiscal policy and labor markets that will remain important factors in the pound’s performance. On top of that, policy decisions of the other two central banks will impact the currency pair prices.
These currencies’ fundamentals reflect that their divergence is going to remain intact for some time to come. Inflation levels, fiscal policy choices, and economic growth vary from country to country in terms of pace and resilience. As a result, two-way risks remain prevalent in these currencies and will persist. These countries’ differences will play out in the currencies’ trade balances and capital movements, in addition to the central banks’ capabilities to stabilize growth.
According to UOB’s Quek Ser Leang, GBP/USD’s sharp rebound has left scope to test major resistance at 1.3445, though a clear break is seen as unlikely in the near term. Short-term support lies at 1.3390 and 1.3360. Over one to three weeks, strengthened momentum could open 1.3480 if 1.3445 gives way, while broader ranges dominate over months.
Pound testing key resistance band"24-HOUR VIEW: GBP fell to 1.3315 on Wednesday and then rebounded strongly. When GBP was at 1.3390 in the early Asian session yesterday, we highlighted that “the sharp rebound appears to be overdone, but there is a chance for GBP to test 1.3420 before the risk of a pullback increases.” We added, “the major resistance at 1.3445 is unlikely to come into view.” GBP then rose to 1.3430, pulled back to 1.3381 before moving back up to close at 1.3409 (+0.14%). While there has been no clear increase in upward momentum, there is a chance for GBP to test the major resistance at 1.3445. A clear break above this level is unlikely. Support is at 1.3390."
"1-3 WEEKS VIEW: Tracking our positive GBP view from late last month, we highlighted yesterday (09 Jul, spot at 1.3390) that “while the risk remains on the upside, given that there has been no further increase in upward momentum, it is left to be seen if GBP can reach 1.3445.” GBP subsequently rose to a high of 1.3430. Upward momentum has strengthened somewhat, and should GBP break above 1.3445, the next level to watch is 1.3480. On the downside, a breach of 1.3360 (‘strong support’ level was at 1.3315 yesterday) would indicate that GBP is not advancing further."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
The Pound to Dollar (GBP/USD) exchange rate traded around 1.3431 on Friday, extending its recovery to fresh one-year highs as Sterling continued to outperform while the US Dollar remained under pressure.
Latest — Exchange Rates:
Pound to Dollar (GBP/USD): 1.343026 (+0.13%)
Euro to Dollar (EUR/USD): 1.144055 (+0.07%)
Dollar to Yen (USD/JPY): 161.53132 (-0.52%)
DAILY RECAP:
GBP/USD climbed for a third consecutive session, with the pair moving above 1.34 after briefly dipping below 1.3350 earlier in the week.
Sterling has continued to benefit from a combination of easing political uncertainty and expectations that the Bank of England will remain cautious over the pace of future rate cuts.
Recent UK data has been mixed, but inflation remains above target and investors continue to believe policymakers will be reluctant to ease policy aggressively.
In its latest FX briefing, ING argued that Sterling is increasingly taking its direction from domestic developments rather than simply following moves in global bond markets.
The US Dollar, meanwhile, has struggled to regain momentum.
Although the Federal Reserve minutes showed policymakers remain divided over the outlook for interest rates, investors have become less convinced that US rates will move materially higher this year. Broader risk appetite has also improved following a tentative easing in Middle East tensions, reducing demand for traditional safe-haven assets.
MUFG said in its latest market commentary that the Dollar remains vulnerable while positioning continues to unwind and investors rotate back into higher-beta currencies.
Scotiabank also highlighted that recent Dollar weakness has been driven more by changing market positioning than by any fundamental deterioration in the US economy.
With Sterling finding domestic support and the Dollar losing some of its defensive appeal, GBP/USD has reached its highest levels since last summer.
Near-Term GBP/USD Forecast: UK Activity Data and Fed Speakers in Focus For Pound Sterling, with nothing on the calendar for Friday, attention will turn to next Tuesday's final first-quarter UK GDP estimate, together with manufacturing production, industrial production and trade balance figures.
Investors will also be listening closely to comments from Bank of England policymakers for any fresh clues on the timing of future rate cuts.
For the US Dollar, markets will focus on Federal Reserve speakers, including policymakers due to speak after the release of the latest FOMC minutes, alongside US CPI inflation expectations and consumer sentiment updates later in the week.
Investors will also continue to monitor developments in the Middle East after the recent ceasefire reduced some of the geopolitical risk premium.
If UK economic data remains resilient while the Dollar stays under pressure, GBP/USD could extend towards "dense resistance ahead of 1.3500."
However, stronger US data or a renewed flight to safety could pull the pair back towards 1.3300.
According to Shaun Osborne, Chief FX Strategist at Scotiabank, "the GBP’s recovery is looking even more entrenched as it stages its first meaningful attempt at breaking above recent resistance around 1.3400 and levels that roughly correspond to the 50 and 200 day MA’s.
"The offers dense resistance ahead of 1.3500.
"We note the continued recovery in the RSI, climbing to the upper 50s.
"We look to a near-term range bound between 1.3350 and 1.3450."
The GBP/USD pair trades in positive territory around 1.3430 during the early European trading hours on Friday. The UK government leadership transition and growing expectations of further Bank of England (BoE) interest rate hikes underpin the British Pound (GBP) against the US Dollar (USD).
Andy Burnham’s path to becoming the next UK prime minister looks certain after a vast majority of Labour MPs formally nominated him to be the next party leader. Bloomberg reported on Thursday that 322 of 403 Labour members of Parliament voted for Burnham at the end of the first day of the party’s leadership contest to replace Keir Starmer. Burnham is expected to formally become Prime Minister on July 20.
Traders have ramped up bets on the BoE interest rate hikes amid escalating tensions between the US and Iran. Markets are now fully pricing in a 25 basis points (bps) BoE rate increase by year-end, most likely in December, according to Reuters.
Technical Analysis:In the daily chart, GBP/USD holds a modest bullish bias as it sits above the 100-day simple moving average (SMA) and the Bollinger Bands’ 20-day SMA. The pair is edging higher toward the upper Bollinger band, while the 14-day Relative Strength Index hovers just below the 60 mark, suggesting firm but not overstretched upside momentum as price grinds higher within the broader range.
On the topside, initial resistance aligns with the upper Bollinger band near 1.3475, and a daily close above this cap would open the way for the April 15 high of 1.3579. On the downside, immediate support is seen at the 100-day SMA at 1.3405. A deeper pullback would expose the Bollinger midline near 1.3305, while the lower band around 1.3130 marks a more distant floor guarding the broader uptrend structure.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Pound Sterling FAQs The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE).
The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects.
Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall.
Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
British Pound: Recovery tests key resistance against US Dollar – ScotiabankScotiabank strategists Shaun Osborne and Eric Theoret report the British Pound (GBP) is fractionally higher versus the US Dollar (USD), with sentiment improving after PM Starmer’s resignation announcement. They see support from a repriced Bank of England (BoE) rate path following the latest Oil rally and describe GBP/USD’s recovery as increasingly entrenched as it attempts to break above 1.3400 and trades within a 1.3350–1.3450 range.
"The pound is up fractionally vs. the USD and is a mid-performer among the G10 currencies as we head into Thursday’s NA session with focus still largely centered on broader developments in the absence of high-level domestic releases." Read more...
British Pound elevates despite firm US claimsGBP/USD trades higher near the 1.3400 area on Thursday, as the US Dollar (USD) fails to find support from stronger-than-expected United States (US) jobless claims data and hawkish signals in the latest Federal Open Market Committee (FOMC) Minutes.
United States (US) Initial Jobless Claims fell to 215K, below expectations of 218K and the previous revised 217K, while the four-week average eased to 218.75K from 222.5K. However, Continuing Jobless Claims rose slightly to 1.814 million from 1.806 million, suggesting that while layoffs remain limited, workers are still taking longer to find new jobs. Read more...
British Pound hits fresh three-week highs past 1.3400 as US Dollar pulls backThe British Pound (GBP) appreciates against the US Dollar (USD) for the second consecutive day on Thursday, to hit fresh three–week highs right above 1.3400. The Greenback's pullback following the release of the Federal Reserve’s (Fed) minutes and rumours about the resumption of the US-Iran negotiations are keeping the pair buoyed.
The US and Iran traded attacks for the second consecutive day on Thursday, but risk aversion remains contained so far, with markets hopeful that the negotiations will continue. US President Donald Trump affirmed earlier on Thursday that Tehran “wants to make a deal so badly,” which suggests that the peace talks might resume soon. Read more...
