The Pound to Dollar exchange rate held near 1.3325 on Friday, having retreated more than two cents from July’s high around 1.3558.
GBP/USD is still around 0.6% higher this month, but Sterling has struggled to respond to a stronger run of UK economic data.
Over the past year, the pair has traded between approximately 1.3010 and 1.3858.
Scotiabank noted that June retail sales were far stronger than expected, while the preliminary July business surveys also surprised positively.
The manufacturing PMI rose to 52.8, signalling a solid expansion, while the services index recovered from contraction territory to 51.8.
Despite the upbeat figures, the bank said “market participants are clearly not responding to fundamentals”, with political uncertainty and concerns over the UK’s fiscal position continuing to weigh on the Pound.
Attention now turns to next Thursday’s Bank of England meeting. Rates are expected to remain unchanged, but Scotiabank anticipates a hawkish hold alongside updated economic forecasts.
Markets currently price around 16 basis points of tightening by September and 32 basis points by November.
Pound Sterling could gain if policymakers strengthen the case for a rate rise at the following meeting.
The options market is sending a more cautious signal, however, with demand increasing for protection against renewed GBP weakness.
Scotiabank linked the shift to geopolitical risks and domestic political concerns, both of which have pushed gilt yields higher.
The bank’s technical outlook remains neutral.
GBP/USD has slipped below the support previously expected near 1.3350, leaving 1.3300 as the immediate level to watch.
Stronger support is located at 1.3150, with resistance around 1.3550.
Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.
Rabobank expects renewed pressure on Pound exchange rates as concerns over Prime Minister Andy Burnham’s spending plans unsettle the gilt market. The British Pound concluded this trading week facing a difficult combination of political uncertainty, elevated UK bond yields and doubts over how the new government intends to fund its policy agenda.
UK economists at Rabobank say the initial market response to Burnham’s cabinet and early policy announcements has been notably cautious.
Latest — Exchange Rates:
Pound to Euro (GBP/EUR): 1.171822 (+0.14%)
Pound to Dollar (GBP/USD): 1.332498 (+0.09%)
Euro to Dollar (EUR/USD): 1.137117 (-0.05%)
The UK 10-year gilt yield has moved above 5.0%, while Pound Sterling has ranked as the weakest G10 currency over the latest one-day period.
Although the appointment of an experienced Chancellor has offered some reassurance, the bank warns that uncertainty surrounding the government’s fiscal strategy could keep both gilts and the Pound under pressure.
Rabobank analysts expect EUR/GBP to rise to 0.8650 over the next three months and sees scope for GBP/USD to fall back towards 1.3200.
At current rates, those forecasts imply a weaker Pound against both the Euro and the US Dollar.
Rabobank Warns Burnham’s Honeymoon Could Be Brief Rabobank says the appointment of Healey as Chancellor is a stabilising factor because the country’s finances have been placed in the hands of an experienced politician with previous Treasury exposure and respect across Parliament.
However, the larger question is how Burnham plans to finance his agenda.
The Prime Minister has said he intends to use “flexibility” within the fiscal rules, which Rabobank says could point towards placing some infrastructure-related debt on the balance sheets of public financial institutions.
Although such borrowing might sit outside the most closely watched fiscal measures, it would still need to be absorbed by the bond market.
“The market will be wary about whether this constitutes ‘back door’ funding,” Rabobank says.
The government’s first cost-of-living measure is a reduction in VAT on household electricity bills from October.
Officials have indicated that the measure will be funded by cancelling the previous government’s digital identity programme, although reports have raised doubts over whether that scheme was fully funded in the first place.
Rabobank notes that use of greater flexibility within the fiscal rules could potentially mobilise an additional £16 billion for infrastructure projects over the remainder of the decade.
Infrastructure investment could improve productivity in parts of the UK outside London and the South East, but those benefits may take years to materialise.
Burnam, by contrast, faces a general election in less than three years.
That leaves the government under pressure to deliver visible improvements quickly, increasing the risk that spending commitments expand before the economic benefits become apparent.
“The market is now bracing itself for a list of further announcements,” Rabobank says.
“This suggests that funding issues will remain at the fore of the market’s mind and hints that Burnham’s honeymoon may be short-lived.”
Gilt Market Particularly Sensitive The latest UK borrowing figures were slightly better than expected for June, but borrowing over the first three months of the fiscal year remains above projections from the Office for Budget Responsibility.
At an early stage of the financial year, that overshoot might ordinarily attract limited attention.
Rabobank argues that the political backdrop makes investors more sensitive than usual.
Burnham is associated with the softer left of the Labour Party and has said he wants government to become less reliant on what he described as the “imperial” Treasury.
Against this backdrop, the bond market is likely to demand clear reassurance that new spending plans will remain compatible with the fiscal rules.
Rabobank also highlights structural vulnerabilities in the UK economy.
The country has a low household savings ratio and a substantial current-account deficit, increasing its dependence on overseas capital.
These characteristics can amplify market reactions when confidence deteriorates.
“The UK may not have the largest debt-to-GDP ratio in the developed world, but arguably it has one of the most sensitive debt markets,” Rabobank says.
Lower BoE Expectations Are Another Pound Risk The reduction in VAT on household electricity bills should mechanically lower inflation.
Rabobank also expects headline UK CPI inflation to ease to 2.7% year on year, offering some short-term reassurance to the gilt market.
The inflation outlook remains complicated by higher spot energy prices following the escalation in the US-Iran conflict, but Rabobank believes current Bank of England pricing is too aggressive.
Markets are pricing approximately 43 basis points of BoE tightening over the next six months.
Rabobank expects the central bank to avoid raising rates this year.
“On our view, this is overdone and a reduction in market expectations for BoE policy tightening is another headwind for the pound,” the bank says.
This is important because elevated UK interest-rate expectations have provided Sterling with some protection against fiscal and political concerns.
Were investors to remove those expected rate increases, the Pound would lose part of its yield advantage at the same time as the gilt market remains uneasy about government borrowing.
Image: Exchange Rates UK Research polling shows GBP/USD median bank forecast chart showing the live rate near 1.3325, a Q3 median near 1.32 and the longer-term forecast path GBP/USD Forecast: 1.3200 Comes Back Into View GBP/USD ended the latest session around 1.3325, recording a modest daily gain after Thursday’s 0.47% decline.
The pair has nevertheless fallen by more than two cents from the 15 July close near 1.3540 and remains well below July’s high of 1.3558.
The short-term chart shows Sterling attempting to stabilise around 1.3320 after repeated failures to sustain advances above 1.3340.
GBP/USD is trading close to the 20-period moving average at 1.3327 and session VWAP near 1.3323.
That positioning suggests the pair is currently balanced around its immediate fair-value area rather than developing a strong recovery.
The 200-period moving average near 1.3340 remains the more important overhead barrier.
A recent rebound failed close to that level, confirming the 1.3340-1.3350 region as the first substantial resistance zone.
RSI has recovered to approximately 48 from below 40, showing that downside momentum has eased.
However, the indicator remains below 50 and does not yet signal that buyers have regained control.
Initial support is located around 1.3310, followed by 1.3290.
Rabobank’s 1.3200 objective would come into clearer view following a break below these levels, while July’s low at 1.3221 represents a significant intermediate support area.
On the upside, a sustained move above 1.3340 would reduce immediate downside pressure, although GBP/USD would still need to recover through 1.3400 to suggest the broader July correction has ended.
Image: GBP/USD 15-minute chart with 1.3310 support, 1.3340 resistance and Rabobank’s 1.3200 forecast marked The median bank forecast path also points to near-term weakness before a later recovery.
The Q3 2026 median projection is close to 1.3200, broadly matching Rabobank’s three-month forecast, while the consensus path then rises towards 1.35 in early 2027 and approximately 1.38 by the end of that year.
Rabobank’s view is therefore consistent with the wider consensus in anticipating near-term pressure, although it does not rule out a longer-term recovery.
Image: EUR/GBP survey poll forecasts July 2026 EUR/GBP Forecast: Rabobank Targets 0.8650 EUR/GBP closed around 0.8534 after falling 0.14% in the latest session.
The cross has recovered from July’s low near 0.8455, but remains almost 1% lower for the month and below the July opening level near 0.8614.
The 15-minute chart shows that EUR/GBP has surrendered part of its recent rebound after failing above 0.8550.
The cross is trading close to its 20-period moving average near 0.8533, but remains below session VWAP around 0.8541 and beneath the 200-period moving average near 0.8539.
This leaves the immediate technical picture mixed.
The latest recovery from below 0.8530 shows that selling pressure has moderated, while RSI near 46 has moved above its signal line.
However, the cross remains below the neutral 50 level and has yet to overcome the main intraday resistance cluster.
Initial resistance is located around 0.8539-0.8542, followed by 0.8547 and the recent highs around 0.8550-0.8555.
A break through that area would strengthen the case for a return towards 0.8600.
Rabobank’s 0.8650 forecast lies above the current technical range and would require a more decisive deterioration in Sterling sentiment.
On the downside, support is located around 0.8530, followed by 0.8525.
A break below these levels would weaken the immediate recovery and raise the risk of a renewed move towards 0.8500.
Image: EUR/GBP 15-minute chart with 0.8530 support, 0.8550 resistance The wider bank consensus also leans towards a higher EUR/GBP rate over the coming quarters.
The median forecast stands close to 0.8700 from the third quarter of 2026 through early 2028, before easing towards 0.8600 and then 0.8450 by the end of 2028.
Rabobank’s 0.8650 target is therefore slightly below the near-term consensus median but still implies a meaningful Sterling decline from current levels.
Pound Sterling: Rabobank’s forecasts leave GBP exposed on two fronts Against the Euro, the bank expects EUR/GBP to rise towards 0.8650 as investors question the government’s fiscal plans and reassess the likelihood of Bank of England tightening.
Against the Dollar, it sees GBP/USD falling towards 1.3200 as political uncertainty, gilt-market sensitivity and lower UK rate expectations weigh on the Pound.
The technical charts show that neither move has yet been fully confirmed.
GBP/USD is attempting to stabilise around 1.3320, while EUR/GBP remains below resistance around 0.8550.
However, the fundamental risks identified by Rabobank remain unresolved.
A reduction in expected BoE tightening would remove an important source of Sterling support, while further spending announcements without a convincing funding plan could renew pressure on gilts.
The base case is therefore for Pound Sterling to remain vulnerable, with a GBP/USD break below 1.3290 strengthening the path towards 1.3200 and an EUR/GBP move above 0.8550 opening the way towards Rabobank’s 0.8650 target.
US Dollar Talking Points: The US Dollar retains a bullish look from weekly, daily and four-hour charts and next week brings the FOMC, which helped to fire the current rally back in June when they sounded more hawkish than expected. Next week also brings the BoE and BoJ, and USD/JPY has been a large component of that USD breakout of late as the pair has pushed to fresh 40-year highs.
US Dollar The FOMC rate decision in June is what finally helped USD bulls to take a big step forward and from the weekly chart, that move is still quite evident although it started to stall shortly after running into the Fibonacci level at 101.80.
Since then, the pullback retained structure as shown by a bull flag formation, and that led into topside breakout this week after the European Central Bank rate decision.
US Dollar Daily Chart Chart prepared by James Stanley; data derived from Tradingview USD Shorter-Term Going into next week we have a bullish short-term trend to go along with that bullish bigger picture backdrop and there’s a few different spots to investigate for possible higher-low support in the Dollar. Nearby is the 101.20 and 101 areas, with 100.90, 100.65 and 100.36-100.44 areas.
Of course, as usual, the big question draws down to USD counterparts as the DXY basket is simply a composition of underlying currencies, so for strength themes to continue to play, we’ll likely need to see continued weakness in markets like the Euro or Japanese Yen.
US Dollar Four-Hour Price Chart Chart prepared by James Stanley; data derived from Tradingview USD/JPY
As looked at earlier in the week the Bank of Japan is between a rock and a hard place. It’s difficult to pick between either defending the Yen or supporting growth, especially given the bigger picture for the Japanese economy with a dwindling population and the hangover of decades of deflation and disinflation.
This helps to explain why, to this point, there hasn’t been much more than band aids applied to the matter in the form of interventions which, essentially, have been long opportunities for bulls after the dust has settled.
As we go into next week the BoJ is not expected to hike but I’d be surprised if Ueda doesn’t try to address the matter in some form, as failing to do so could lead to an aggressive continuation of a slide that would force the MoF into action. And that would cost capital in the form of burning finite FX reserves to bid down a move that their own rate policy is encouraging, so more likely from here, at least in my opinion, is we hear Ueda try to sound tough on inflation without doing anything concrete.
The more attractive scenario is if it would be enough to bring a pullback without too much to reverse the trend. Of course, we have the Fed to get through before that so the way that USD markets respond there will have impact to how USD/JPY sets up into the BoJ.
From a technical basis, 162.95 was resistance as an ascending triangle built and it hasn’t yet come in as support, so this would be an ideal area to look for bullish defense. Below that, 161.81 is of note before 160.64 comes into play.
USD/JPY Daily Chart Chart prepared by James Stanley; data derived from Tradingview EUR/USD In the USD video on StoneX coming into this week, I shared my opinion that it was EUR/USD dynamics that would determine USD flows and that’s ended up as the case after the European Central Bank rate decision on Thursday.
That led to a bearish break of the bear flag in the EUR/USD pair which went along with the bullish break of the bull flag in the USD.
For next week, bears have an open door to make a move here as we have a bearish short-term setup and a bearish long-term setup, and that Thursday candle was both a bearish engulf as well as the downside break of the flag formation.
EUR/USD Daily Chart Chart prepared by James Stanley; data derived from Tradingview GBP/USD In the effort of balance, I often try to find something on the other side of the USD especially when there’s so many items pointing in a single direction. I’ve been tracking GBP/USD for USD-weakness setups and while that was attractive in early trade last week, as the pair broke out to a fresh higher-high on the US PPI report, the backdrop since has been unforgiving as USD strength has come roaring back.
For next week, there’s a BoE rate decision and that could be meaningful, particularly if Warsh sounds less hawkish than he did in June. Given the relative weakness in equities there may be reason for him to push in that direction and if that happens, I think GBP/USD could be one of the more attractive spots to look for Dollar weakness.
That said, price action on the four hour is bearish, so bulls have some work to do here if they’re going to turn this into a rally. There has been a bit of stalling around the 1.3300 but it’s 1.3390 that I would like to see come into play in order to set up that theme, after which higher-low potential could create a set up to work with.
GBP/USD Four-Hour Price Chart Chart prepared by James Stanley; data derived from Tradingview --- written by James Stanley, Senior Market Analyst, Global Macro
Key Points:EUR/USD gained some ground as traders reacted to PMI reports. GBP/USD moved higher, supported by stronger-than-expected UK Retail Sales. USD/JPY continued its attempts to settle above the resistance level at 163.50 - 164.00.
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U.S. Dollar Moves Lower As Oil Pulls Back
DXY 240726 4h Chart U.S. Dollar Index is losing ground as traders focus on the pullback in the oil markets. WTI oil declined towards the $88.00 level as traders hoped that U.S. and Iran will get back to negotiations. Falling oil prices reduced demand for safe-haven assets, which was bearish for the American currency.
Today, traders also focused on PMI reports. Manufacturing PMI declined from 53.9 in June to 53.8 in July, compared to analyst forecast of 54.3. Services PMI improved from 51.2 to 53.6, compared to analyst consensus of 51.5. Numbers above 50 show expansion.
EUR/USD Gains Gound As Euro Area PMI Reports Exceed Estimates
EUR/USD 240726 4h Chart EUR/USD attempts to rebound as traders focus on better-than-expected PMI data from the EU. Euro Area Manufacturing PMI increased from 51.4 in June to 52.0 in July, compared to analyst forecast of 51.5. Euro Area Services PMI improved from 49.4 to 51.6, compared to analyst consensus of 49.8.
The nearest support level for EUR/USD is located in the 1.1350 – 1.1365 range. In case EUR/USD manages to settle below the 1.1350 level, it will head towards the next support level at 1.1270 – 1.1285.
GBP/USD Gains Ground As UK Retail Sales Beat Estimates GBP/USD 240726 4h Chart GBP/USD is moving higher as UK Manufacturing PMI and UK Services PMI exceeded analyst estimates. Falling oil prices provided additional support to the British pound. Better-than-expected Retail Sales report served as an additional positive catalyst for GBP/USD. The report indicated that Retail Sales increased by +1% month-over-month in June.
Currently, GBP/USD is trying to settle back above the resistance level at 1.3335 – 1.3350. In case GBP/USD manages to settle above the 1.3335 level, it will head towards the 50 MA at 1.3414. A move above the 50 MA will open the way to the test of the resistance level at 1.3450 – 1.3465. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.
USD/CAD Is Mostly Flat As Traders Focus On Commodity Markets USD/CAD 240726 4h Chart USD/CAD is mostly flat despite the rebound in precious metals markets. Other commodity-related currencies are moving higher in today’s trading session.
In case USD/CAD pulls back below the 50 MA at 1.4061, it will head towards the support level at 1.4010 – 1.4025.
On the upside, USD/CAD needs to settle above the resistance level at 1.4125 – 1.4140 to have a chance to gain upside momentum in the near term. A move above the 1.4140 level will push USD/CAD towards the next resistance level at 1.4235 – 1.4250.
USD/JPY Tests Resistance At 163.50 – 164.00 USD/JPY 240726 4h Chart USD/JPY remains stuck near the 164.00 level as traders react to inflation data from Japan. Inflation Rate increased from 1.5% in May to 1.7% in June, in line with analyst consensus. Core inflation Rate increased from 1.4% to 1.6%. The report has also met analyst estimates.
From the technical point of view, USD/JPY attempts to settle above the resistance level at 163.50 – 164.00. In case USD/JPY manages to settle above the 164.00 level, it will head towards the psychologically important 165.00 level. These levels have not been tested since 1986. RSI is in the overbought territory, but there is some room to gain additional momentum in the near term.
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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 advances by some 0.20% on Friday as Oil prices tumble, weighing on the US Dollar, while the US-Iran conflict signals a further escalation, which market participants ignored. Despite registering daily gains, the GBP/USD is poised to finish the week with losses of nearly 0.70%. Read More...
British Pound retreats from 1.3340 as bright UK data fails to offset risk aversionThe British Pound (GBP) remains depressed near three-week lows against the US Dollar (USD) on Friday, with upside attempts capped below 1.3340, and on track for a 1% weekly decline. The upbeat UK Preliminary S&P Global Purchasing Managers Index (PMI) and Retail Sales reports failed to lift the Pound, heavily weighed by risk-averse markets and increasing fiscal concerns in the UK. Read More...
British Pound rebounds above 1.3300 ahead of UK Retail Sales dataThe GBP/USD pair recovers some lost ground to near 1.3325, snapping the five-day losing streak during the Asian trading hours on Friday. However, the potential upside might be limited amid heightened military tensions in the Middle East. Traders brace for the release of the UK Retail Sales data, which will be published later on Friday. Read More...
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HomeTechnical AnalysisIntraday Analysis 24.07.2026 JPY remains under pressure
USDJPY hits multi-month high
The Japanese yen remains pressured after the pair broke to another fresh high. The bullish bias remains intact even though the pair has hit some resistance.
The bullish mood means that pullbacks have been opportunities for the buy side to stake in. The greenback is testing the next target at 163.30. Another breakout would cement the dollar’s supremacy and pave the way for a rally towards 164.00. On the downside, 162.60 is the first support, with 162.00 a critical bottom.
GBPUSD finds support
Cable was given a boost after the recent downward spiral lifted price action, after finding some support.
A fall below 1.3400 was a sign of profit-taking after bulls struggled to push back, putting a dent in the short-term mood. However, Sterling still has an edge from the intraday chart perspective. A recent bounce to prevent a test at 1.3320 has seen buyers re-enter the market with a slight uptick in bids. The brief support-turned-resistance of 1.3400 is the level to lift before cable can create an uptrend towards 1.3550. UK 100 falls from its peak
The FTSE is left licking its wounds after hitting a heavy rejection to prevent another move higher.
A push towards the previous swing high of 10760 put the bulls on the attack, before retracing. The latest downtick could continue towards 10625, should bears attract more sellers. 10550 is the next level lower should the sell-off continue.
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Dollar Index Price Chart – Source: Tradingview The USD Index remains positive after bouncing off the 100.50-100.60 support area and recapturing the 101.20 level. Current quotes around 101.33 sit above the 50-EMA (at 101.06) and the 100-EMA (at 100.97), which indicates buyers have been taking charge. The DXY’s rising trend line is continuing to act as support, and the current reading at RSI 60 suggests there is room for further upside, with no imminent signs of overbought conditions.
The first resistance is at 101.65, followed by 102.06 and then 102.42. On the lower side, the new support comes in at 101.20, with the 100.50 and 99.92 areas attracting buyers.
Provided DXY sustains above 101.20, the uptrend is on track and another leg higher towards 101.65-102.06 may be in the cards. The bullish perspective would fade if the DXY were to slide below 100.50 and open the way for further losses towards 99.92.
GBP/USD Technical Analysis: Bears Remain in Control Below Key Resistance
The Pound to US Dollar (GBP/USD) exchange rate traded in a narrow range on Thursday as investors continued to assess Prime Minister Andy Burnham's first week in office while awaiting fresh economic data.
At the time of writing, GBP/USD was trading around $1.3362, down marginally on the day.
Latest — Exchange Rates:
Pound to Dollar (GBP/USD): 1.3319 (-0.42%)
Euro to Dollar (EUR/USD): 1.137743 (-0.30%)
Dollar to Yen (USD/JPY): 163.85814 (+0.47%)
DAILY RECAP:
The Pound (GBP) traded with modest losses on Thursday as markets continued to assess Andy Burnham’s first week as Prime Minister.
Sterling had rallied ahead of Burnham’s arrival in Downing Street as investors unwound the political risk premium previously priced into the currency.
However, the Pound edged lower this week amid lingering concerns over how the government's new spending commitments and tax cuts will be financed.
Losses in Sterling were somewhat limited by hopes that the proposed measures could support economic growth.
Plans including a 20% cut in business rates for pubs, clubs and music venues in England, alongside lower VAT on household energy bills, helped temper some fiscal concerns, although GBP investors remained cautious.
Meanwhile, the US Dollar (USD) lacked clear direction as a quiet US economic calendar and mixed market sentiment left the safe-haven currency rangebound.
While global markets remain concerned about the escalating conflict in the Middle East, broader risk appetite has proved surprisingly resilient despite the worsening geopolitical backdrop.
Some investors continued to hope that diplomatic efforts could eventually produce a peace agreement, although optimism appeared to be fading.
Near-Term GBP/USD Forecast: PMI Surveys in the Spotlight Looking ahead, the UK's June retail sales figures will be the first major release on Friday.
Economists expect sales to have fallen by 0.3%, which could place the Pound under pressure.
Attention will then turn to the UK's latest PMI surveys, with the services index expected to be the key focus for Sterling investors. Any improvement in business activity during July could help support the Pound.
Meanwhile, the US S&P Global PMI surveys will be released later in the day. While typically less influential than the ISM reports, stronger-than-expected readings could still provide the US Dollar with additional support.
British Pound rebounds above 1.3300 ahead of UK Retail Sales dataThe GBP/USD pair recovers some lost ground to near 1.3325, snapping the five-day losing streak during the Asian trading hours on Friday. However, the potential upside might be limited amid heightened military tensions in the Middle East. Traders brace for the release of the UK Retail Sales data, which will be published later on Friday.
Renewed geopolitical tensions in the Middle East could underpin the US Dollar (USD) as a safe-haven currency. The US Central Command (CENTCOM) said it launched its 13th consecutive night against Iranian targets. US President Donald Trump said on Thursday that the US would hold Iran responsible for the Houthis’ actions and warned Iran and its Houthi allies would both soon receive a “major military punishment,” per the Guardian. Read more...
British Pound Sterling slides for a sixth session on a Dollar story Britain had no part inSterling's sixth consecutive losing session arrives without a single domestic headline behind it, and that absence is the more useful fact about Thursday than the 0.45% loss itself. GBP/USD trades near 1.3300 after setting a high just short of 1.3400 in the small hours and grinding lower through everything that followed.
The move belongs entirely to the Dollar, which is being bought for reasons that have nothing to do with Britain. A currency does not lose six sessions running on coincidence, but it can lose them without ever being the subject of the story. Read more...
GBP/USD Price Forecast: Struggles to return above 20-day EMAThe British Pound (GBP) trades marginally higher to near 1.3387 against the US Dollar (USD) during the European trading session on Thursday. The GBP/USD pair edges higher as the US Dollar drops despite surging oil prices in the wake of escalating Middle East energy supply risks.
At press time, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades 0.15% lower to near 101.00. Read more...
Key Points:EUR/USD pulled back below the 1.1400 level as traders reacted to ECB Interest Rate Decision. GBP/USD moved lower as traders focused on the strong rally in the oil markets. USD/JPY tested multi-decade higher amid rising Treasury yields.
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U.S. Dollar Moves Higher Amid Rising Demand For Safe-Haven Assets
DXY 230726 4h Chart U.S. Dollar Index gains ground as traders focus on the strong rally in the oil markets and react to the better-than-expected Initial Jobless Claims report.
The report indicated that 187,000 Americans filed for unemployment benefits in a week, compared to analyst forecast of 212,000.
Oil prices gained 6.5% as Houthis attacked vessels linked to Saudi Arabia. Brent oil climbed above the psychologically important $100 level. As a result, demand for safe-haven assets increased, which was bullish for the U.S. dollar.
U.S. Dollar Index climbed above the resistance at 101.15 – 101.30 and is trying to settle above the 101.50 level. In case this attempt is successful, U.S. Dollar Index will move towards the resistance level at 101.80 – 101.95.
EUR/USD Retreats As ECB Leaves Rates Unchanged EUR/USD 230726 4h Chart EUR/USD is losing ground as traders react to ECB Interest Rate Decision. The European Central Bank left the interest rate unchanged at 2.4%, in line with analyst estimates.
Comments from ECB President Christine Lagarde showed that ECB was ready to raise rates in September due to high oil prices.
Currently, EUR/USD is trying to settle below the support level at 1.1350 – 1.1365. In case this attempt is successful, EUR/USD will head towards the next support level at 1.1270 – 1.1285.
GBP/USD Tests New Lows As Oil Prices Rally GBP/USD 230726 4h Chart GBP/USD is under pressure as traders focus on the potential impact of high oil prices. Demand for risk assets declined, which was bearish for the British pound.
From the technical point of view, GBP/USD moved below the support level at 1.3335 – 1.3350 and is trying to settle below the 1.3300 level. If GBP/USD manages to settle below 1.3300, it will head towards the support at 1.3250 – 1.3265. RSI has just moved into oversold territory, but there is enough room to gain additional momentum in the near term.
USD/CAD 230726 4h Chart USD/CAD is mostly flat as traders react to developments in commodity markets. Precious metals markets suffered a sell-off while oil markets soared. Other commodity-related currencies pulled back in today’s trading session.
Today, traders also focused on the Retail Sales report from Canada. The report showed that Retail Sales increased by +0.4% month-over-month in June, in line with analyst estimates.
If USD/CAD manages to settle back above the 1.4100 level, it will head towards the nearest resistance level, which is located in the 1.4125 – 1.4140 range. A move above the 1.4140 level will open the way to the test of the resistance at 1.4235 – 1.4250.
USD/JPY Tests Multi-Decade Highs USD/JPY 230726 4h Chart USD/JPY tests new highs as traders focus on rising Treasury yields. The yield of 2-year Treasuries climbed towards the 4.35% level, while the yield of 10-year Treasuries settled near 4.70%. Rising oil prices serve as a major negative catalyst for the Japanese yen as Japan’s economy is dependent on energy imports.
Currently, USD/JPY is trying to settle above the 164.00 level. In case USD/JPY manages to settle above 164.00, it will head towards the 165.00 level. It should be noted that RSI is in the overbought territory, so the risks of a pullback are rising.
If you’d like to know more about how to trade forex, please visit our educational area.
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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 drops by over 0.40% against the Greenback as risk aversion weighs on most G8 currencies amid the escalation of the Middle East conflict and growing speculation of an extended US campaign against Iran. The GBP/USD trades at 1.3313 after reaching a daily high at 1.3393. Read More...
British Pound holds losses below 1.3400 as PM Burnam stokes fiscal worriesThe British Pound (GBP) consolidates losses below 1.3400 against the US Dollar (USD) on Thursday, on track for a 0.6% weekly decline, following a reversal from 1.3558 highs last week. The soft inflation figures released on Wednesday, coupled with growing concerns about Prime Minister Andrew Burnham’s spending plans, have sent the Pound lower across the board this week. Read More...
British Pound nudges higher above 1.3350 despite Middle East turmoilThe GBP/USD pair rebounds to near 1.3385 during the Asian trading hours on Thursday. However, the potential upside for the major pair might be limited amid cooler-than-expected UK inflation data and escalating tensions in the Middle East. Traders will take more cues from the UK Retail Sales report, which is due later on Friday. Read More...
Orbex Group Limited is the holding company of Orbex Global Limited, Orbex Limited is an affiliate with Orbex Global Limited. Orbex Global Limited is authorized and regulated by Mauritius Financial Services Commission “FSC” (View License). Orbex.com is owned by Orbex Group Limited and is operated by Orbex Global Limited with registered address: Ground Floor, The Catalyst, Silicon Avenue, 40 Cybercity, 72201 Ebène, Republic of Mauritius
Risk Warning: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. There is a possibility that you may sustain a loss of some or all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. Orbex Global does not offer its services to residents of certain jurisdictions such as Mauritius, USA, and North Korea.
The Pound to US Dollar (GBP/USD) exchange rate traded in a narrow range on Wednesday as softer UK inflation was offset by resilient core price growth, while escalating geopolitical tensions supported demand for the US Dollar.
At the time of writing, GBP/USD was trading around $1.3372, little changed from Wednesday’s opening levels.
Latest — Exchange Rates:
Pound to Dollar (GBP/USD): 1.337154 (-0.05%)
Euro to Dollar (EUR/USD): 1.141084 (+0.08%)
Dollar to Yen (USD/JPY): 163.14385 (-0.03%)
DAILY RECAP:
The Pound (GBP) held its ground on Wednesday following the release of the UK's latest inflation figures.
Data from the Office for National Statistics (ONS) showed headline CPI eased from 2.8% to 2.6% in June, below forecasts for a reading of 2.7% and marking the slowest pace of price growth since March 2025.
The softer-than-expected inflation reading had the potential to weigh on Sterling by reinforcing expectations that the more dovish members of the Bank of England (BoE) could resist further policy tightening later this year.
However, pressure on the Pound remained limited. A stickier core inflation reading provided support, while analysts noted that renewed conflict in the Gulf is already pushing energy prices higher, potentially limiting the recent slowdown in inflation.
Meanwhile, the US Dollar (USD) regained some bullish momentum as escalating tensions around the Strait of Hormuz triggered a fresh wave of risk aversion across global markets.
Intensifying hostilities and increasing disruption to shipping through the strategically important waterway pushed Brent crude back above US$94 a barrel, renewing concerns over global energy supplies and boosting demand for traditional safe-haven assets.
The rise in oil prices also reinforced expectations that higher energy costs could feed through into US inflation, supporting the case for further Federal Reserve policy tightening in the months ahead.
Near-Term GBP/USD Forecast: Fiscal Uncertainty Under Burnham to Dampen Sterling? Looking ahead, Thursday brings a brief lull in the UK economic calendar, leaving political developments as the likely driver of the Pound to US Dollar exchange rate.
The ongoing reaction in the UK gilt market to Andy Burnham's first days in office could leave Sterling under pressure if investors remain concerned about the government's spending plans and how they will be funded.
Meanwhile, the US Dollar may face modest pressure if the latest US initial jobless claims report shows an increase in new unemployment claims.
Dollar Index Price Chart – Source: Tradingview The Dollar Index remains anchored to its uptrend and the 100.50 support area, preserving the bullish picture despite modest losses today. Trading near 101.01, the DXY is comfortably above its 50-EMA (100.38) and 100-EMA (99.80), with bullish control remaining intact higher on the timeframe.
The first level of resistance to watch is 101.65, with the next major ones coming in at 102.30 and 103.02. Initial support is provided by 100.50, with the rising trendline and 99.53 providing further support further back. RSI sits in the mid-50 area around 55, showing that momentum remains mostly neutral to slightly bullish despite being cooled from its earlier peak, thus the opportunity for yet another upside leg remains on the table.
If 100.50 holds, the bias would still be positive for renewed buying in an effort to test 101.65. Should the pair trade above the aforementioned levels in a daily close, the scenario would strengthen for another push towards 102.30, but the trendline and 100.50 could break, causing that bullish perspective to be pushed off and instead testing the 99.53.
GBP/USD Technical Analysis: Recovery Faces Strong Resistance Near 1.3400
The British Pound (GBP) trades marginally higher to near 1.3387 against the US Dollar (USD) during the European trading session on Thursday. The GBP/USD pair edges higher as the US Dollar drops despite surging oil prices in the wake of escalating Middle East energy supply risks.
At press time, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades 0.15% lower to near 101.00.
On the domestic front, investors await the Federal Reserve’s (Fed) monetary policy announcement next week, in which it is expected to leave interest rates unchanged.
Meanwhile, the British Pound demonstrates a broader mixed performance while fears of Bank of England (BoE) interest rate hikes have eased. Traders doubt the BoE will tighten monetary conditions in the near term as the United Kingdom (UK) headline Consumer Price Index (CPI) growth has cooled down to 2.6% Year-on-Year (YoY) in June from the previous reading of 2.8%.
BoE seen on extended hold before gradual easing to neutral in 2027Economists at Societe Generale reiterate that their “baseline forecast remains that the BoE will keep Bank Rate on hold at 3.75% throughout 2026,” reflecting a view that policymakers will need prolonged time to consolidate the disinflation trend. They add that “by early 2027, we expect the MPC to gain confidence that inflation will return sustainably to the 2% target over the medium term, allowing for cumulative rate cuts of 75bp in 2027,” which would “bring Bank Rate to our estimate of its neutral level of 3%.”
Going forward, investors will focus on the UK Retail Sales for June and the preliminary S&P Global PMI data for July, which will be released on Friday.
GBP/USD technical analysis
GBP/USD trades slightly higher at around 1.3387 at press time. The pair corrects to near the 20-day exponential moving average (EMA), which is at 1.3385, after correcting from the downward-sloping border of the Descending Triangle pattern at 1.3540, suggesting that the near-term outlook has become uncertain.
The Relative Strength Index (14) at 50.73 sits near neutral, hinting that recent buying pressure is stabilizing rather than driving a decisive breakout, leaving the near-term bias slightly constructive but still capped by overhead trend resistance.
On the topside, initial resistance is located at the downward-sloping trend-line region near 1.3501, followed by the July 15 high at 1.3558. On the downside, the July 8 low at 1.3322 is the immediate support zone, with a more notable cushion at the June 24 low at 1.3140.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Economic Indicator Consumer Price Index (YoY) The United Kingdom (UK) Consumer Price Index (CPI), released by the Office for National Statistics on a monthly basis, is a measure of consumer price inflation – the rate at which the prices of goods and services bought by households rise or fall – produced to international standards. It is the inflation measure used in the government’s target. The YoY reading compares prices in the reference month to a year earlier. Generally, a high reading is seen as bullish for the Pound Sterling (GBP), while a low reading is seen as bearish.
Read more.
The Bank of England is tasked with keeping inflation, as measured by the headline Consumer Price Index (CPI) at around 2%, giving the monthly release its importance. An increase in inflation implies a quicker and sooner increase of interest rates or the reduction of bond-buying by the BOE, which means squeezing the supply of pounds. Conversely, a drop in the pace of price rises indicates looser monetary policy. A higher-than-expected result tends to be GBP bullish.
United Overseas Bank’s Quek Ser Leang and Lee Sue Ann expect GBP/USD to consolidate intraday between 1.3350 and 1.3400 after a modest pullback from recent lows. However, for the coming weeks, Quek Ser Leang warns that rapidly building downside momentum means a daily close below 1.3340 could open 1.3300. The strong resistance cap has been lowered to 1.3435, while the broader multi‑month view remains range‑bound.
Pound-Dollar pressured but still range bound"24-HOUR VIEW: GBP dropped sharply to a low of 1.3360 two days ago. Yesterday, when GBP was at 1.3375, we indicated that “the rapid increase in downward momentum suggests GBP could continue to decline.” However, we highlighted that “last week’s low, near 1.3340, is expected to provide firm support.” GBP weakened less than expected to 1.3355 before closing largely unchanged at 1.3376 (+0.01%). With momentum indicators turning flat, we expect GBP to consolidate today, most likely between 1.3350 and 1.3400."
"1-3 WEEKS VIEW: Following the sharp decline in GBP two days ago, we highlighted yesterday (22 Jul, spot at 1.3375) that “downward momentum is increasing rapidly, and if GBP closes below 1.3340, it is likely to decline further to 1.3300.” We added, “the likelihood of GBP closing below 1.3340 will remain intact as long as the ‘strong resistance’ level, now at 1.3455, is not breached.” We continue to hold the same view, but we are revising the ‘strong resistance’ level to 1.3435."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
British Pound nudges higher above 1.3350 despite Middle East turmoilThe GBP/USD pair rebounds to near 1.3385 during the Asian trading hours on Thursday. However, the potential upside for the major pair might be limited amid cooler-than-expected UK inflation data and escalating tensions in the Middle East. Traders will take more cues from the UK Retail Sales report, which is due later on Friday.
The UK headline Consumer Price Index (CPI) inflation slowed to 2.6% YoY in June, the lowest since March 2025, down from 2.8% in May, according to the Office for National Statistics (ONS) on Wednesday. This figure came in softer than the market expectations of 2.7% growth. Read more...
A cooler inflation print buys British Pound Sterling nothing but a slower declineThe Pound's week-long slide slowed to a crawl on Wednesday, and it picked an odd session to do so, because the June inflation report handed sellers their cleanest argument yet. GBP/USD tagged the 1.3350 area in early New York trade, its weakest level in over a week, and now sits between that floor and the converged moving-average band just below 1.3400, on track for a fifth straight daily decline measured in single-digit pips.
The Office for National Statistics put headline Consumer Price Index (CPI) inflation at 2.6% YoY for June, under the 2.7% consensus, down from 2.8% in May and the lowest annual rate since March 2025. Services inflation eased to 3.6% from 3.7%, the monthly gain ran at just 0.1%, and transport and food did most of the downward work, precisely the categories a war-supply shock was supposed to keep hot. Read more...
British Pound steadies as cooler UK CPI meets Oil shockThe Pound Sterling holds firm during the North American session as UK inflation data dipped, easing pressure on the Bank of England to tackle higher prices, while attacks between the US and Iran don’t seem to be ending in the Middle East. The GBP/USD trades at 1.3377.
During the European session, UK inflation data for June dipped from 2.8% to 2.6% YoY. The core Consumer Price Index (CPI) remained steady at 2.6% YoY for the same period. Even though this relieves the BoE, traders continued to price in an 82% chance for a rate hike by the November 5 meeting, according to Prime Terminal data. Read more...
Key Points:EUR/USD gained some ground ahead of tomorrow's ECB decision.USD/CAD moved lower as precious metals markets rallied. USD/JPY remained stuck near the 163.00 level.
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U.S. Dollar Index Is Stuck Near Resistance At 101.15 – 101.30
DXY 220726 4h Chart U.S. Dollar Index is losing some ground despite rising Treasury yields. The yield of 2-year Treasuries settled above 4.30%, while the yield of 10-year Treasuries moved above 4.65%. Oil prices continue to move higher, but U.S. dollar does not get additional support.
From the technical point of view, U.S. Dollar Index is stuck below the resistance level at 101.15 – 101.30. In case this attempt is successful, U.S. Dollar Index will head towards the next resistance level, which is located in the 101.80 – 101.95 range.
EUR/USD Attempts To Rebound Ahead Of ECB Decision
EUR/USD 220726 4h Chart EUR/USD gains some ground ahead of ECB Interest Rate Decision, which will be released tomorrow. Analysts expect that ECB will leave the interest rate unchanged at 2.4%. The deposit facility rate is expected to remain unchanged at 2.25%.
In case EUR/USD manages to settle above the resistance level at 1.1420 – 1.1435, it will head towards the next resistance level, which is located in the 1.1500 – 1.1515 range. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.
GBP/USD Pulls Back As Traders Focus On UK Inflation Data GBP/USD 220726 4h Chart GBP/USD is losing ground as traders focus on inflation data from the UK. Inflation Rate declined from 2.8% in May to 2.6% in June, compared to analyst forecast of 2.7%. Core Inflation Rate remained unchanged at 2.6%, while analysts expected that it would drop to 2.5%.
The nearest support level for GBP/USD is located in the 1.3335 – 1.3350 range. A move below the 1.3335 level will open the way to the test of the next support level at 1.3250 – 1.3265.
On the upside, GBP/USD needs to settle above the 1.3400 level to have a chance to gain upside momentum in the near term. If GBP/USD climbs above 1.3400, it will head towards the 50 MA at 1.3424. A move above the 50 MA will push GBP/USD towards the resistance at 1.3450 – 1.3465.
USD/CAD 220726 4h Chart USD/CAD pulled back as traders focused on the rally in precious metals markets. Gold climbed towards the $4150 level, while silver moved towards the psychologically important $60.00 level. Other commodity-related currencies are losing ground in today’s trading session.
If USD/CAD declines below the 50 MA at 1.4075, it will move towards the support level, which is located in the 1.4010 – 1.4025 range.
On the upside, a successful test of the resistance at 1.4125 – 1.4140 will push USD/CAD towards the resistance level at 1.4235 – 1.4250.
USD/JPY Is Stuck Near 163.00 USD/JPY 220726 4h Chart USD/JPY settled near the 163.00 level as traders worried about potential interventions from the Bank of Japan.
Today, traders also had a chance to take a look at the Exports report from Japan. The report indicated that Japan’s Exports increased by +19.3% year-over-year, compared to analyst consensus of +18.6%.
In case USD/JPY settles above 163.00, it will head towards the 165.00 level. RSI has recently moved back into moderate territory, so there is plenty of room to gain additional upside momentum in case the right catalysts emerge.
If you’d like to know more about how to trade forex, please visit our educational area.
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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 holds firm during the North American session as UK inflation data dipped, easing pressure on the Bank of England to tackle higher prices, while attacks between the US and Iran don’t seem to be ending in the Middle East. The GBP/USD trades at 1.3377. Read More...
UK inflation cools and fiscal concerns grow: Why the British Pound is surrendering recent gainsThe British Pound (GBP) is facing renewed downward pressure across major currency pairs, forfeiting its recent gains as market participants digest a combination of cooling domestic inflation and growing fiscal uncertainty surrounding Prime Minister Andy Burnham’s economic agenda. Read More...
British Pound remains depressed against US Dollar following soft UK inflation dataThe British Pound (GBP) consolidates losses against the US Dollar (USD) on Wednesday, as a string of UK inflation figures provided some leeway for the Bank of England to maintain its “wait-and-see” stance through the coming months. The GBP/USD pair remains pinned near weekly lows, below 1.3400 following a nearly 1.2% decline in the last four days. Read More...
Orbex Group Limited is the holding company of Orbex Global Limited, Orbex Limited is an affiliate with Orbex Global Limited. Orbex Global Limited is authorized and regulated by Mauritius Financial Services Commission “FSC” (View License). Orbex.com is owned by Orbex Group Limited and is operated by Orbex Global Limited with registered address: Ground Floor, The Catalyst, Silicon Avenue, 40 Cybercity, 72201 Ebène, Republic of Mauritius
Risk Warning: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. There is a possibility that you may sustain a loss of some or all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. Orbex Global does not offer its services to residents of certain jurisdictions such as Mauritius, USA, and North Korea.
Interest rates in America continue to put bearish pressure on some currencies.
EUR/USD Technical Analysis
EUR/USD daily chart, slipping near 1.1410 toward the 1.1400 level. Source: TradingView The euro has rallied slightly in the early part of the trading session on Wednesday, but as you can see, the market is struggling to continue to go to the upside. Ultimately, this is a market that is trying to hang around the 1.14 level and make a bigger decision as to where we are going next.
With that being the case, I think this is a market that anytime it rallies, there will be a certain amount of people willing to sell it. Rising interest rates in America continue to put bearish pressure on this pair. The 1.14 level is a support area. Some traders could even see this as a bearish flag with the measure of the pole somewhere just around the 1.12 level.
GBP/USD Technical Analysis
GBP/USD daily chart, hovering near 1.3370 where its EMAs converge. Source: TradingView The British pound initially rallied, but it looks like the sellers are starting to come back in as well with those higher rates. That does make a certain amount of sense as the interest rate differential shrinks between London and DC. With so many concerns around the world, the US dollar is considered to be a safety currency most of the time. Maybe that is what is going on, but we are right in the middle of a larger consolidation area, and that is something worth paying attention to as well.
USD/CHF Technical Analysis USD/CHF daily chart, pushing near 0.8120 back toward its July highs. Source: TradingView The US dollar has done very little against the Swiss franc during the trading session on Wednesday. The 0.8150 level continues to be an area that is attracting a certain amount of attention as potential resistance. A break above there would be a bullish sign; it would be a break of a swing high in an area that goes back quite some time. Short-term pullbacks continue to attract buyers. The interest rate differential most decidedly favors America here, so carry traders like buying this as well.
If you’d like to know more about how to trade forex, please visit our educational area.
GBP/USD remains steady after four days of losses, trading around 1.3370 during the European hours on Wednesday. The pair is holding a mildly bearish near‑term bias as spot remains capped beneath the 50‑day and nine-day Exponential Moving Averages (EMAs).
The 14-day Relative Strength Index (RSI) at 49.56 sits near the neutral line, hinting at consolidative momentum rather than a decisive directional push. Read more...
British Pound remains depressed against US Dollar following soft UK inflation dataThe British Pound (GBP) consolidates losses against the US Dollar (USD) on Wednesday, as a string of UK inflation figures provided some leeway for the Bank of England to maintain its “wait-and-see” stance through the coming months. The GBP/USD pair remains pinned near weekly lows, below 1.3400 following a nearly 1.2% decline in the last four days.
Data released by the UK National Statistics Office on Wednesday revealed that the Consumer Price Index (CPI) moderated to a 2.6% year-over-year (Y-o-Y) growth in June, from 2.8% in May, below the 2.7% forecasted by market analysts. The Core CPI, however, remained steady at 2.6% against expectations of a 2.5% reading. Read more...
British Pound attracts bids against Japanese Yen after mixed UK CPI dataThe British Pound (GBP) witnesses slight buying interest against its major currency peers after the release of the United Kingdom (UK) Consumer Price Index (CPI) data for June. Against the Japanese Yen (JPY), the British currency rebounds strongly from the intraday low of 218.20.
The Office for National Statistics (ONS) has reported a slower-than-expected headline CPI growth. The headline inflation arrives at 2.6% Year-on-Year (YoY), lower than the estimates of 2.7% and the previous reading of 2.8%. On a monthly basis, the headline inflation rises at a moderate pace of 0.1%, as expected, against the previous reading of 0.2%. Read more...
GBP/USD remains steady after four days of losses, trading around 1.3370 during the European hours on Wednesday. The pair is holding a mildly bearish near‑term bias as spot remains capped beneath the 50‑day and nine-day Exponential Moving Averages (EMAs).
The 14-day Relative Strength Index (RSI) at 49.56 sits near the neutral line, hinting at consolidative momentum rather than a decisive directional push.
The technical analysis of the daily chart suggests a bearish breakdown and signals a potential trend reversal or consolidation phase as the GBP/USD pair has broken below the lower boundary of an ascending channel. Further support lies at the eight-month low of 1.3140, recorded on June 24.
On the upside, the immediate barrier lies at the 50-day EMA of 1.3383, followed by the nine-day EMA at 1.3406. A rebound above the moving averages would revive the bullish bias and support the GBP/USD pair to explore the region around the upper boundary of the ascending channel around 1.3640, followed by the five-month high of 1.3658, reached on May 1. A break above this level would expose 1.3869, the highest level since September 2021, reached on January 27.
GBP/USD: Daily Chart(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 New Zealand Dollar.
USDEURGBPJPYCADAUDNZDCHFUSD-0.11%-0.04%-0.10%-0.11%0.02%0.10%-0.12%EUR0.11%0.08%0.04%-0.00%0.13%0.22%-0.01%GBP0.04%-0.08%-0.04%-0.08%0.04%0.14%-0.09%JPY0.10%-0.04%0.04%-0.01%0.13%0.20%-0.02%CAD0.11%0.00%0.08%0.01%0.14%0.27%-0.01%AUD-0.02%-0.13%-0.04%-0.13%-0.14%0.10%-0.14%NZD-0.10%-0.22%-0.14%-0.20%-0.27%-0.10%-0.25%CHF0.12%0.00%0.09%0.02%0.00%0.14%0.25% 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 US Dollar (GBP/USD) exchange rate weakened on Wednesday after UK inflation cooled by more than expected in June, reducing expectations for further Bank of England policy tightening, while the US Dollar remained underpinned by cautious market sentiment.
At the time of writing, GBP/USD was trading around $1.3374, slipping modestly as investors reacted to the softer UK inflation report.
Latest — Exchange Rates:
Pound to Dollar (GBP/USD): 1.337429 (-0.03%)
Euro to Dollar (EUR/USD): 1.141025 (+0.07%)
Dollar to Yen (USD/JPY): 163.12016 (-0.04%)
DAILY RECAP:
The Pound (GBP) came under pressure after UK inflation slowed more than expected in June.
Official figures showed headline consumer price inflation eased to 2.6%, down from 2.8% in May and below forecasts for a 2.7% reading, as lower petrol and transport costs helped reduce price pressures. The softer inflation print reinforced expectations that the Bank of England is unlikely to tighten monetary policy in the near term.
The weaker inflation data overshadowed Tuesday's stronger-than-expected labour market report, which had shown unemployment holding at 4.9% and employment increasing by 147,000.
Political uncertainty also continued to linger after Prime Minister Andy Burnham appointed John Healey as Chancellor, with investors continuing to assess the fiscal implications of the new government's policy agenda.
Meanwhile, the US Dollar (USD) remained broadly supported as investors continued to favour the Greenback amid lingering geopolitical uncertainty and expectations that the Federal Reserve will maintain a relatively restrictive monetary policy.
Near-Term GBP/USD Forecast: Softer UK Inflation Shifts Focus to the Fed The sharper-than-expected slowdown in UK inflation has strengthened expectations that the Bank of England can leave interest rates unchanged while assessing the outlook for inflation and economic growth.
Investors will now look to upcoming UK retail sales and PMI data to determine whether inflation is easing without a material slowdown in economic activity.
For the US Dollar, attention will remain focused on Federal Reserve policymakers and incoming US economic data for further clues on the interest rate outlook.
If US data continues to point to a resilient economy while UK inflation remains subdued, the US Dollar may retain the upper hand against Sterling in the near term.
The British Pound (GBP) consolidates losses against the US Dollar (USD) on Wednesday, as a string of UK inflation figures provided some leeway for the Bank of England to maintain its “wait-and-see” stance through the coming months. The GBP/USD pair remains pinned near weekly lows, below 1.3400 following a nearly 1.2% decline in the last four days.
Data released by the UK National Statistics Office on Wednesday revealed that the Consumer Price Index (CPI) moderated to a 2.6% year-over-year (Y-o-Y) growth in June, from 2.8% in May, below the 2.7% forecasted by market analysts. The Core CPI, however, remained steady at 2.6% against expectations of a 2.5% reading.
Beyond that, the Input Producer Price Index (PPI) contracted 2% on the month, its sharpest decline in more than six years, while the Output PPI remained flat, undershooting expectations of a 0.4% advance. Year on year, input PPI eased to 7.3% from 9.3% while the Output PPI slowed down to 3.5% in June from 3.7% in May.
In the US, the calendar has been thin this week, but the US Dollar maintains a bid tone, buoyed by market concerns about the war in the Middle East and higher US Treasury yields. The US military pounded targets in Iran for the 11th consecutive day on Wednesday, and US President Donald Trump threatened to attack nuclear facilities, which, according to Tehran, would expand the war in the region.
UK Pound slides amid PM Burnham’s early fiscal signalsRabobank’s FX team notes that “UK markets have now had a few hours to react to PM Burnham’s new cabinet, many of whom have been involved in UK politics for years,” and the initial response has been cautious. They highlight that “10-year gilt yields are currently above the 5% level, which is a sign of some anxiety,” while “the Pound is the worst performing G10 currency on a 1-day view,” underscoring investor unease around the new administration’s fiscal direction.
In the near term, Rabobank points out that “Burnham has promised measures to ease cost-of-living pressures,” with the policy push already underway. “He kicked this off this morning with the news that VAT on household electricity bills will be cut from October,” the bank observes, adding that “the market is now bracing itself for a list of further announcements” as investors assess how these initiatives will be funded and what they might mean for UK assets.
Economic Indicator Consumer Price Index (YoY) The United Kingdom (UK) Consumer Price Index (CPI), released by the Office for National Statistics on a monthly basis, is a measure of consumer price inflation – the rate at which the prices of goods and services bought by households rise or fall – produced to international standards. It is the inflation measure used in the government’s target. The YoY reading compares prices in the reference month to a year earlier. Generally, a high reading is seen as bullish for the Pound Sterling (GBP), while a low reading is seen as bearish.
Read more.
The Bank of England is tasked with keeping inflation, as measured by the headline Consumer Price Index (CPI) at around 2%, giving the monthly release its importance. An increase in inflation implies a quicker and sooner increase of interest rates or the reduction of bond-buying by the BOE, which means squeezing the supply of pounds. Conversely, a drop in the pace of price rises indicates looser monetary policy. A higher-than-expected result tends to be GBP bullish.
Economic Indicator Consumer Price Index (MoM) The United Kingdom (UK) Consumer Price Index (CPI), released by the Office for National Statistics on a monthly basis, is a measure of consumer price inflation – the rate at which the prices of goods and services bought by households rise or fall – produced to international standards. It is also the inflation measure used in the government’s target. The MoM figure compares the prices of goods in the reference month to the previous month. Generally, a high reading is seen as bullish for the Pound Sterling (GBP), while a low reading is seen as bearish.
Dollar Index Price Chart – Source: Tradingview The US Dollar Index (DXY) is maintaining the medium-term uptrend as the price managed to defend the demand zone around 100.50 and the rising trendline on the daily timeframe. Currently, it is seen changing hands near the 101.14 area above the 50-EMA (100.35) and the 100-EMA (99.78) on the daily chart, and the bulls continue to be in control.
Price faced some initial resistance around the 101.65 level with resistance at 102.30, and then 103.02. On the downside, support is seen near 100.50, then 99.53, and then 98.76. The RSI recovered to the 57 level, indicating that the bullish trend continues.
Technically, the trendline support area witnessed its retest and price bounced off it, reinforcing the bullish trend. The price is expected to continue to the upside as long as the 100.50 level continues to hold the support. The bears are likely to lose control of the market and buyers will move prices towards 101.65 and then 102.30, but the support at the 100.50 level is critical and any failure will open up the downside for the price and it will fall towards 99.50.
GBP/USD Technical Analysis: Bears Test Channel Support Below Key Moving Averages
British Pound bounces off one-week low vs USD amid Iran diplomacy hopes, ahead of UK CPIThe GBP/USD pair edges higher during the Asian session on Wednesday, snapping a four-day losing streak to the 1.3360 area, or a one-week low, touched the previous day. Spot prices, however, lack follow-through buying and trade below the 1.3400 mark, warranting caution before confirming that the recent pullback from an over two-month high has run its course.
The US Dollar (USD) pauses following a four-day rally to a one-week high amid hopes that US-Iran diplomacy could ease energy prices and temper hawkish US Federal Reserve (Fed) expectations. This, in turn, is seen as a key factor lending support to the GBP/USD pair. However, the geopolitical risk remains in play amid a further escalation of tensions between the US and Iran. Read more...
British Pound Sterling gets a decent jobs report and sells off anywayThe British Pound received a labour market report on Tuesday that beat consensus on nearly every line, and sold off anyway. Sterling slid from a London morning high just above 1.3450 to a New York low just above 1.3350, knifing through the 50-day and 200-day Exponential Moving Averages that sit converged just below 1.3400. GBP/USD trades near 1.3380 late in the session, the weakest of the majors on the day, on track for a fourth consecutive daily decline, and holding its first session beneath both long-term averages since the mid-July rebound began. More than a third of that rebound off the summer base near the 1.3150 area is already gone.
On the surface, Tuesday's labour market data argued for a Pound bid rather than a fourth day of selling. Employment rose 147K in the three months to May against 100K prior, the claimant count climbed just 6.7K in June against a 28.3K consensus, and the unemployment rate slipped to 4.9% when the market expected 5%. The blemish sat in the pay figures, where average earnings including bonuses slowed to 4.3% against a 4.5% consensus, extending the cooling trend the Bank of England has spent months waiting for. Read more...
GBP/USD Price Forecast: Tests nine-day EMA support near 1.3400GBP/USD remains weaker for the fourth consecutive day, trading around 1.3430 during the European hours on Tuesday. The technical analysis of the daily chart indicates a prevailing bullish bias as the pair remains within the ascending channel.
The GBP/USD pair is holding a constructive bullish bias as spot remains above both the nine-day and 50-day Exponential Moving Averages (EMAs). The alignment of shorter and longer EMAs below price suggests an underpinning uptrend, while the 14-day Relative Strength Index (RSI) at roughly 55 points to steady, rather than overstretched, positive momentum. Read more...
The UK Office for National Statistics (ONS) will release the June Consumer Price Index (CPI) figures on Wednesday at 06:00 GMT, a print that will matter for markets. Consensus expectations point to inflation pressures still above the Bank of England’s (BoE) target, although losing further momentum.
UK consumer inflation remains one of the most important inputs for the BoE and typically carries real weight for the British Pound (GBP). Following the latest cautious hold by the BoE on June 18, investors now favour a steady hand by the ‘Old Lady’ at its meeting on July 30.
What to expect from the next UK inflation report?Headline UK CPI is expected to clock 2.7% in the year to June, a tad lower than the May reading. On a monthly basis, inflation is seen gaining 0.1%, adding to the 0.2% increase recorded the previous month.
Core inflation, which strips out the more volatile food and energy components and is therefore more closely watched by the BoE, is forecast at 2.5% on an annual basis, down a tenth of percent from May.
How will the UK CPI data affect GBP/USD?The BoE met expectations and kept the bank rate unchanged at 3.75% on June 18. However, the 7–2 vote split carried a slightly more hawkish tone, with Megan Greene joining Huw Pill in supporting a 25-basis-point increase. But the larger message is patience, with policy still firmly in wait-and-see mode and market pricing that reflects that stance.
In his latest comments last week, Governor Andrew Bailey said the renewed hostilities in the Gulf highlighted the instability facing the global economy. Turning to the UK, he argued that the country was supported by both its fiscal framework and monetary policy, while stressing that the central challenge remained economic growth.
Bailey added that the UK’s core banking system was resilient and that debt levels were not overstretched. However, he warned that sustainable economic growth would not be possible without financial stability.
Implied rates currently suggest nearly 43 basis points of tightening by year-end, while consensus sees the central bank keeping its policy rate unchanged at its next gathering on July 30.
Back to technicals, Senior Analyst at FXStreet, Pablo Piovano, notes that the recent multi-week recovery in GBP/USD appears to have encountered some initial hurdle in the 1.3550-1.3560 band near the July tops. “In case bulls regain the upper hand, the next barrier emerges at the May top at 1.3653 (May 11), followed by the YTD ceiling at 1.3868 (January 27)," he adds.
On the downside, Piovano sees initial contention at current yearly lows near 1.3140 (June 24). “Further weakness from here could expose a move toward the November 2025 base at 1.3010 (November 5),” Piovano adds.
Piovano also points out that momentum indicators remain somewhat bullish for now as the Relative Strength Index (RSI) hovers just below 54, while the Average Directional Index (ADX) near 18 suggests the current trend lacks muscle.
Interest rates FAQs Interest rates are charged by financial institutions on loans to borrowers and are paid as interest to savers and depositors. They are influenced by base lending rates, which are set by central banks in response to changes in the economy. Central banks normally have a mandate to ensure price stability, which in most cases means targeting a core inflation rate of around 2%. If inflation falls below target the central bank may cut base lending rates, with a view to stimulating lending and boosting the economy. If inflation rises substantially above 2% it normally results in the central bank raising base lending rates in an attempt to lower inflation.
Higher interest rates generally help strengthen a country’s currency as they make it a more attractive place for global investors to park their money.
Higher interest rates overall weigh on the price of Gold because they increase the opportunity cost of holding Gold instead of investing in an interest-bearing asset or placing cash in the bank. If interest rates are high that usually pushes up the price of the US Dollar (USD), and since Gold is priced in Dollars, this has the effect of lowering the price of Gold.
The Fed funds rate is the overnight rate at which US banks lend to each other. It is the oft-quoted headline rate set by the Federal Reserve at its FOMC meetings. It is set as a range, for example 4.75%-5.00%, though the upper limit (in that case 5.00%) is the quoted figure. Market expectations for future Fed funds rate are tracked by the CME FedWatch tool, which shapes how many financial markets behave in anticipation of future Federal Reserve monetary policy decisions.
Economic Indicator Consumer Price Index (MoM) The United Kingdom (UK) Consumer Price Index (CPI), released by the Office for National Statistics on a monthly basis, is a measure of consumer price inflation – the rate at which the prices of goods and services bought by households rise or fall – produced to international standards. It is also the inflation measure used in the government’s target. The MoM figure compares the prices of goods in the reference month to the previous month. Generally, a high reading is seen as bullish for the Pound Sterling (GBP), while a low reading is seen as bearish.
The Pound Sterling loses some ground against the US Dollar, down by 0.48%, as risk appetite in the foreign exchange markets deteriorates, with the Greenback reclaiming key technical levels in the US Dollar Index (DXY) amid the escalation of the US-Iran conflict. The GBP/USD trades at 1.3371, after reaching a daily high of 1.3455. Read More...
British Pound extends losses nearing 1.3400 as markets await Burnham’s policiesThe British Pound (GBP) is one of the weakest performers among major currencies, extending its reversal against the US Dollar for the fourth consecutive week. The GBP/USD pair is drifting closer to the 1.3400 level heading into the US trading session on Tuesday, as investors ponder UK Prime Minister Burnham's promises and the profiles of his cabinet's members. Read More...
British Pound attracts bids after UK employment data releaseThe British Pound (GBP) snaps a three-day losing streak against the Japanese Yen (JPY), rebounding to near 218.55 during the European trading session on Tuesday. The cross attracts bids after the release of the United Kingdom (UK) labor market data for the three months ending May. Read More...
Key Points:GBP/USD pulled back despite the better-than-expected UK Unemployment Rate report. USD/CAD gained ground as traders ignored the rally in precious metals markets. USD/JPY tested the 163.00 level as traders focused on rising Treasury yields.
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U.S. Dollar Moves Higher Amid Rising Demand For Safe-Haven Assets
DXY 210726 4h Chart U.S. Dollar Index gains ground as traders react to rising oil prices. WTI oil moved above the $84.00 level amid rising tensions in the Middle East. Demand for safe-haven assets increased, which was bullish for the U.S. dollar.
Treasury yields are moving higher as bond traders bet that high oil prices will force Fed to raise rates. The yield of 2-year Treasuries climbed above the 4.25% level, while the yield of 10-year Treasuries settled above 4.63%. Rising Treasury yields provided additional support to the American currency.
Currently, U.S. Dollar Index is trying to settle above the resistance at 101.15 – 101.30. In case this attempt is successful, U.S. Dollar Index will move towards the resistance level at 101.80 – 102.00.
EUR/USD Attempts To Settle Below The 1.1400 Level EUR/USD 210726 4h Chart EUR/USD is mostly flat as traders focus on the Euro Area ZEW Economic Sentiment Index report. The report indicated that Economic Sentiment increased from 9.5 in June to 23.4 in July, compared to analyst forecast of 11.2.
If EUR/USD stays below the support level at 1.1420 – 1.1435, it will head towards the next 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 momentum in the near term.
GBP/USD Retreats As Pullback Continues GBP/USD 210726 4h Chart GBP/USD remains under pressure as traders stay focused on first moves of new UK Prime Minister and react to the UK Unemployment Rate report. The report indicated that Unemployment Rate remained unchanged at 4.9% in May, compared to analyst forecast of 5.0%.
The nearest support level for GBP/USD is located in the 1.3335 – 1.3350 range. If GBP/USD manages to settle below the 1.3335 level, it will head towards the next support at 1.3250 – 1.3265.
USD/CAD Gains Ground Amid Rising Treasury Yields USD/CAD 210726 4h Chart USD/CAD is moving higher as traders focus on rising Treasury yields and ignore the rally in precious metals markets. Gold moved above the $4050 level, while silver settled above $59.00. Other commodity-related currencies are mixed in today’s trading session.
In case USD/CAD stays above the 50 MA at 1.4083, it will move towards the resistance at 1.4125 – 1.4140. A successful test of the resistance at 1.4125 – 1.4140 will open the way to the test of the next resistance level at 1.4235 – 1.4250.
USD/JPY Tests Multi-Decade Highs USD/JPY 210726 4h Chart USD/JPY is trying to settle above the 163.00 level as traders ignore intervention risks and focus on the fundamental weakness of the Japanese currency.
Rising Treasury yields put significant pressure on the Japanese yen due to the ultra-dovish policy of the Bank of Japan. High oil prices serve as an additional bearish catalyst as Japanese economy is dependent on energy imports. A combination of higher Treasury yields and rising oil prices pushed the Japanese yen towards multi-decade lows.
In case USD/JPY settles above the 163.00 level, it will head towards the 165.00 level. RSI is in the overbought territory, but there is enough room to gain additional momentum in the near term. Potential BoJ interventions are the key risk for the bulls.
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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 Key Points The UK jobs report was mixed, with unemployment falling but wages coming in lower than expected. Traders are skeptical about the new UK government, but aren’t panicking yet. The Pound is the weakest major currency on the day, with GBP/USD falling -50 pips on the day to break below a 1-month bullish trendline.
Outside of earnings reports from Alphabet and Tesla after the bell tomorrow, most of the major market-moving economic data will come from the European continent this week. Today’s focus is on the situation in the UK.
During this morning’s European session, the UK jobs report pointed to a labor market that is stabilizing, albeit at a relatively weak level. Unemployment slipped to 4.9% in the three months through May, while the employment rate edged up to 75.1%. In terms of raw numbers, new unemployment claimants fell to 6.7K, well below expectations of 29K, while average earnings rose 4.3% 3mo/y, below the 4.5% that economists had anticipated. Overall, easing wage pressure and weak hiring should reassure the Bank of England that domestic inflation is cooling, although conflicting employment surveys and recent data-quality problems argue against placing too much weight on this report in isolation.
New Chancellor and Energy VAT In one of new Prime Minister Andy Burnham’s first moves, John Healey was appointed Chancellor of the Exchequer yesterday. Healey has previous junior Treasury experience, but his recent political profile was built at the Ministry of Defence, where he criticized the Treasury for constraining government ambitions and pushed for defense spending to reach 3% of GDP by 2030.
His first comments in the new role emphasized that fiscal control and market credibility remain central, a key note to hit in an economy plagued by high debt, elevated borrowing costs and little room for significant unfunded spending.
The government’s first cost-of-living measure will temporarily cut VAT on household electricity from 5% to zero for six months beginning October 1, reducing the typical annualized bill by around £45 and costing approximately £850 million in 2026–27. Ministers say the measure will be funded by cancelling the previous government’s planned £1.8 billion digital ID program, although the IFS notes that the program’s funding had never been fully identified, weakening the claim that its cancellation creates a straightforward cash saving. For the broader economy, the policy should mechanically lower headline inflation and provide some household relief, but it is modest in scale.
Moving forward, traders will key in on any policy pronouncements from the new government, with the highly-anticipated November budget already looming in the back of some traders’ minds.
British Pound Technical Analysis: GBP/USD 4-Hour Chart
Source: Tradingview, StoneX
Markets are already expressing a dollop of skepticism toward the new government, with the yield on the benchmark 10yr Gilt rising 6bps since the announcement to cross back above the psychologically significant 5% level. Meanwhile, pound sterling is the weakest major currency on the day, falling more than 50 pips against the greenback as of writing and breaking below a 1-month bullish trendline. Moving forward, the pair is likely to remain under pressure, with near-term support at last week’s low near 1.3350 and then the 1.3300 level. Only a recovery back above 1.3450 would erase the near-term bearish bias.
-- Written by Matt Weller, Global Head of Research
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GBP/USD remains weaker for the fourth consecutive day, trading around 1.3430 during the European hours on Tuesday. The technical analysis of the daily chart indicates a prevailing bullish bias as the pair remains within the ascending channel.
The GBP/USD pair is holding a constructive bullish bias as spot remains above both the nine-day and 50-day Exponential Moving Averages (EMAs). The alignment of shorter and longer EMAs below price suggests an underpinning uptrend, while the 14-day Relative Strength Index (RSI) at roughly 55 points to steady, rather than overstretched, positive momentum. Read more...
GBP/USD falls after cabinet changesGBP/USD fell to 1.3437 on Tuesday as investors assessed the appointment of Andy Burnham as the new Prime Minister of the UK and the outlook for monetary policy.
Burnham succeeded Keir Starmer without a contest, becoming the country's seventh prime minister in the past decade and the second since the Labour Party returned to power in 2024. Read more...
British Pound attracts bids after UK employment data releaseThe British Pound (GBP) snaps a three-day losing streak against the Japanese Yen (JPY), rebounding to near 218.55 during the European trading session on Tuesday. The cross attracts bids after the release of the United Kingdom (UK) labor market data for the three months ending May.
The Office for National Statistics (ONS) has reported that the economy created 147K fresh jobs, higher than the previous reading of 100K. The ILO Unemployment Rate remained steady at 4.9%, while it was expected to arrive higher at 5%. Read more...
Societe Generale strategists note that dip buying in Sterling has kept GBP/USD trading above its 200-day moving average near 1.3403, even as Gilts remain under pressure. The pair trades within a 1.3400–1.3500 range, with investors assessing the appointment of new Chancellor John Healey and upcoming UK CPI data, which they expect to show a modest easing in headline and services inflation.
Sterling supported as investors eye CPI"Dip buying in sterling keeps GBP/USD above the 200dma (1.3403) and halts the rebound in EUR/GBP. UK CPI for June will be published tomorrow. SG economics forecast a dip in headline to 2.7% yoy from 2.8%, below the BoE estimate, and in services to 3.6% from 3.7% but no change in core at 2.6%."
"Wage data was not a market mover for the BoE but the small decrease in private sector pay to 2.9% yoy is welcome and minor relief in the broader debate about inflation and threat of second round effects. The premium of Gilts over Bunds trades close to the highs of the Truss debacle in September 2022 at 140bp."
"Notwithstanding the decline in public borrowing by £4bn between May and June thanks to the fall in debt interest payments, the deficit is running £2.7bn ahead of the OBR forecast for the April to June period because of the overshoot in spending by £3.6bn. Receipts are up 7.2% yoy."
"Though the spread has come from just over 170bp at the end of 2024, there should be scope for further tightening if the new chancellor can navigate public finances to safer waters in the autumn budget. The structurally higher level of inflation in the UK compared to the eurozone is the second if not the most important part of the bond jigsaw. Political stability, a rare commodity since the EU referendum in 2016, could tempt investors to turn more bullish on Gilts provided inflation and levels of government spending can be brought under control. "
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
United Overseas Bank’s (UOB) Quek Ser Leang judges GBP/USD price action as range-bound after an unexpected intraday spike and sharp drop. The pair is now expected to hold between 1.3400 and 1.3460 in the short term, with a broader 1.3385–1.3495 range for the coming weeks. Momentum indicators are flat, suggesting neutral direction with wider supports at 1.3210 and 1.3160.
Sterling-Dollar momentum fades into consolidation"24-HOUR VIEW: Yesterday, we highlighted that GBP “is likely to trade in a range between 1.3420 and 1.3475.” The subsequent price movements did not turn out as expected. GBP rose to 1.3481 before declining sharply to a low of 1.3414. The decline could extend further, but given the lack of any significant increase in downward momentum, GBP is likely to remain within a 1.3400/1.3460 range."
"1-3 WEEKS VIEW: Our update from yesterday (20 Jul, spot at 1.3445) remains valid. As highlighted, the recent “build-up in upward momentum has faded,” and GBP “has likely entered a range-trading phase between 1.3385 and 1.3495.”."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
GBP/USD remains weaker for the fourth consecutive day, trading around 1.3430 during the European hours on Tuesday. The technical analysis of the daily chart indicates a prevailing bullish bias as the pair remains within the ascending channel.
The GBP/USD pair is holding a constructive bullish bias as spot remains above both the nine-day and 50-day Exponential Moving Averages (EMAs). The alignment of shorter and longer EMAs below price suggests an underpinning uptrend, while the 14-day Relative Strength Index (RSI) at roughly 55 points to steady, rather than overstretched, positive momentum.
The GBP/USD pair may rise toward the upper boundary of the ascending channel around 1.3630, followed by the five-month high of 1.3658, reached on May 1. A break above this level would expose 1.3869, the highest level since September 2021, reached on January 27.
On the downside, the GBP/USD pair is testing the immediate support at the nine-day EMA of 1.3426, aligned with the lower boundary of the ascending channel. Further support lies at the 50-day EMA at 1.3386. A successful break below the medium-term average would expose nearly an eight-month low of 1.3140, recorded on June 24.
GBP/USD: Daily Chart(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 weakest against the New Zealand Dollar.
USDEURGBPJPYCADAUDNZDCHFUSD-0.08%0.02%0.11%-0.04%-0.35%-0.36%-0.02%EUR0.08%0.10%0.17%0.04%-0.25%-0.28%0.06%GBP-0.02%-0.10%0.07%-0.06%-0.35%-0.38%-0.04%JPY-0.11%-0.17%-0.07%-0.15%-0.44%-0.48%-0.13%CAD0.04%-0.04%0.06%0.15%-0.30%-0.32%0.02%AUD0.35%0.25%0.35%0.44%0.30%-0.03%0.31%NZD0.36%0.28%0.38%0.48%0.32%0.03%0.34%CHF0.02%-0.06%0.04%0.13%-0.02%-0.31%-0.34% 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).
GBP/USD fell to 1.3437 on Tuesday as investors assessed the appointment of Andy Burnham as the new Prime Minister of the UK and the outlook for monetary policy.
Burnham succeeded Keir Starmer without a contest, becoming the country’s seventh prime minister in the past decade and the second since the Labour Party returned to power in 2024.
The new head of government reaffirmed his commitment to current fiscal rules but indicated he would consider raising the tax-free personal allowance, which has remained frozen in recent years.
Attention is now turning to the appointment of the Chancellor of the Exchequer. According to media reports, Shabana Mahmood is considered the leading candidate.
Additional pressure on the pound is coming from elevated oil prices, which are increasing inflationary risks and reinforcing expectations that the Bank of England will keep interest rates higher for longer.
Technical Analysis
On the H4 GBP/USD chart, the market is moving lower towards 1.3380. A wide consolidation range is forming around the 1.3468 level. An upside breakout from this range would open the way for a move towards 1.3520, while a downside breakout would suggest a decline towards 1.3380, with scope for the trend to extend to 1.3222. The MACD indicator supports this scenario, with its signal line above zero and pointing firmly downwards, reflecting continued bearish momentum.
On the H1 chart, the market has formed a compact consolidation range around the 1.3468 level, currently extending down to 1.3414. A move higher towards 1.3455 is expected, followed by a decline to 1.3380. The Stochastic oscillator confirms this scenario, with its signal line below 80 and pointing downwards towards 20, indicating increasing short-term downside pressure.
Conclusion Sterling has retreated as markets digest the transition of power to Prime Minister Andy Burnham, who has reaffirmed fiscal discipline while signalling a possible increase in the tax-free allowance. Investors are now focused on the appointment of the new Chancellor, with Shabana Mahmood reportedly the frontrunner. Meanwhile, elevated oil prices continue to stoke inflation risks, reinforcing expectations that the Bank of England will maintain higher interest rates for longer. Technically, the pound appears poised for further downside towards 1.3380, with the broader outlook dependent on upcoming fiscal announcements and the trajectory of global energy prices.
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The Pound to US Dollar (GBP/USD) exchange rate traded in a narrow range on Monday as markets reacted cautiously to Andy Burnham's first speech as UK Prime Minister.
At the time of writing, GBP/USD was trading at $1.3449, little changed on the day.
Latest — Exchange Rates:
Pound to Dollar (GBP/USD): 1.342145 (-0.24%)
Euro to Dollar (EUR/USD): 1.141269 (-0.22%)
Dollar to Yen (USD/JPY): 162.49831 (+0.06%)
DAILY RECAP:
The Pound (GBP) lacked a clear catalyst on Monday, amid a muted reaction to Andy Burnham’s first speech as Prime Minister.
The PM’s address was big on vision but light on policy detail, with Burnham saying he would announce some cost-of-living measures – and how to fund them – on Tuesday.
As a result, the speech left GBP investors with little to go on, leading to subdued movement in the Pound.
Meanwhile, UK economic data was thin on the ground, which also limited Sterling.
The US Dollar (USD) also traded in a relatively narrow range on Monday, with USD initially dipping as markets opened before recouping its losses as the session went on.
Escalating tensions in the Middle East helped the US Dollar find its footing after the initial downside, although markets remained surprisingly resilient.
Although the crisis is intensifying, with the US and Iran continuing to launch attacks at one another, there are still hopes that the peace process can get back on track.
A spokesman for the Iranian foreign ministry said on Monday that diplomatic exchanges between Washington and Tehran are ongoing.
Near-Term GBP/USD Forecast: UK Jobs Report in Focus Looking forward, Tuesday kicks off with the UK's latest jobs report.
Markets expect unemployment to have ticked up in the three months to May, rising from 4.9% to 5.0%. However, a forecast increase in employment may help limit Sterling's downside.
GBP investors will also be watching wage growth, with stronger earnings potentially providing additional support for the Pound.
As for the US Dollar, market risk appetite is likely to remain the main driver. If tensions in the Middle East continue to intensify, a more risk-averse mood could support demand for the safe-haven currency.
British Pound struggles as traders evaluate BoE policy, UK political developmentsGBP/USD steadies after three days of losses, trading around 1.3430 during the Asian hours on Tuesday. After recently surging toward two-month highs near 1.3550, the pair has moderated as foreign exchange traders evaluate shifting monetary policies between the Bank of England (BoE) and the US Federal Reserve (Fed) alongside political developments in the United Kingdom (UK).
From a macroeconomic perspective, central bank policy divergence remains the central pillar steering the exchange rate. While market participants anticipate eventual rate adjustments on both sides of the Atlantic, subtle differences in inflation stickiness and labor market strength determine relative yield appeal. Read more...
British Pound Sterling greets a new Prime Minister with a three-day slideGBP/USD trades down around 0.17% on Monday and is on track for a third consecutive daily decline, fading from short of 1.3500 in the London morning to a New York probe just above the 1.3400 handle before steadying between the two. The slide unwinds the last of the mid-July rebound's momentum and confirms that Cable's recovery off the summer base has run out of road well before the levels that matter.
The rejection zone tells the larger story, because 1.3550 has graduated from a line in the sand into a hard wall: it capped the pair in mid-June, repelled last week's push, and now marks the floor of a full-depth resistance zone running up to the next ceiling at 1.3650. With the daily Stochastic Relative Strength Index pushing 90, the market picked the top of an overbought bounce to hand Downing Street to a new tenant. Read more...
British Pound slips as Burnham fiscal pledge fails to lift SterlingThe Pound Sterling reverses course and turns negative on the day as Andy Burnham is named the new Prime Minister and reassures that he will stick to the fiscal rules set by the former Chancellor, Rachel Reeves, who just resigned. The GBP/USD trades at 1.3425, after hitting a daily high of 1.3481.
Sentiment turned upbeat, even though hostilities in the Middle East continued. Attacks between the US and Iran keep tensions high, keeping investors worried about a disruption in Oil supply, which the US Crude Oil benchmark, WTI so far up 21% in the month. This reignited speculation that the Federal Reserve (Fed) could increase rates by 25 basis points toward the end of the year. Read more...
The Pound Sterling reverses course and turns negative on the day as Andy Burnham is named the new Prime Minister and reassures that he will stick to the fiscal rules set by the former Chancellor, Rachel Reeves, who just resigned. The GBP/USD trades at 1.3425, after hitting a daily high of 1.3481. Read More...
British Pound gains as Andy Burnham to become new Prime MinisterGBP/USD gains ground after two days of losses, trading around 1.3470 during the European hours on Monday. The pair strengthens as the UK 10-year gilt yield held near 5%, driven by surging oil prices that stoked inflation fears and signaled that the Bank of England (BoE) may keep interest rates elevated for longer. Read More...
British Pound steadily climbs to 1.3465 on softer USD as UK awaits new PMThe GBP/USD pair rebounds around 30 pips from the Asian session low on Monday, snapping a two-day losing streak amid a modest US Dollar (USD) downtick. Spot prices, however, remain well below a two-month high, touched last Wednesday, as escalating US-Iran tensions and reviving hawkish US Federal Reserve (Fed) expectations help limit USD losses. Read More...
Key Points:EUR/USD pulled back as traders focused on rising Treasury yields. GBP/USD moved lower as traders waited for first moves of new UK Prime Minister. USD/CAD gained ground as Canada's Inflation Rate missed analyst estimates.
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U.S. Dollar Moves Higher At The Start Of The Week
DXY 200726 4h Chart U.S. Dollar Index gains ground as traders focus on rising Treasury yields. The yield of 2-year Treasuries climbed above the 4.22% level, while the yield of 10-year Treasuries settled near 4.60%. Treasury yields are moving higher as bond traders worry that rising oil prices will create inflationary pressure.
U.S. Dollar Index managed to settle above the 50 MA at 100.86 and is trying to settle above the 100.00 level. In case this attempt is successful, U.S. Dollar Index will move towards the resistance at 101.15 – 100.30. A successful test of this level will open the way to the test of the next resistance at 101.80 – 101.95. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.
EUR/USD Pulls Back As Germany’s PPI Meets Estimates
EUR/USD 200726 4h Chart EUR/USD pulled back as traders focused on Producer Prices report from Germany. The report showed that PPI increased by +1.8% year-over-year in June, in line with analyst consensus.
Currently, EUR/USD is trying to settle below the support at 1.1420 – 1.1435. In case this attempt is successful, EUR/USD wil move towards the next support level, which is located in the 1.1350 – 1.1365 range.
GBP/USD Retreats As Traders Wait For First Moves From New PM GBP/USD 200726 4h Chart GBP/USD is losing ground as traders react to political developments in the UK. New Prime Minister Andy Burnham promised to bring a new economic model for the UK, but markets remain skeptical. His predecessors also pledged to boost UK finances, but their attempts yielded no results.
In case GBP/USD manages to settle below the 50 MA at 1.3424, it will head towards the nearest support at 1.3335 – 1.3350. On the upside, GBP/USD needs to settle back above the resistance at 1.3450 – 1.3465 to have a chance to gain upside momentum in the near term.
USD/CAD Rebounds As Canada’s Inflation Rate Drops To 2.8% USD/CAD 200726 4h Chart USD/CAD moved away from recent lows as traders focused on inflation data from Canada. Inflation Rate declined from 3.2% in May to 2.8% in June, compared to analyst forecast of 2.9%. Core Inflation Rate decreased from 2.2% to 2.1%, while analysts expected that it would remain unchanged at 2.2%. The lower-than-expected inflation report put pressure on the Canadian dollar. Other commodity-related currencies are gaining ground in today’s trading session.
If USD/CAD settles above the 1.4050 level, it will head towards the 50 MA at 1.4095. A move above the 50 MA will open the way to the test of the resistance level at 1.4125 – 1.4140.
USD/JPY Moves Higher As Treasury Yields Rise
USD/JPY 200726 4h Chart USD/JPY gains ground, supported by rising Treasury yields. However, traders remain cautious as the yen is trading near multi-decade lows. Traders worry that BoJ may intervene to provide support to the national currency.
USD/JPY needs to settle above the 162.80 level to gain additional upside momentum in the near term. In this case, USD/JPY will 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.
United Overseas Bank’s (UOB) Quek Ser Leang reports GBP/USD slipping but lacking strong downside momentum, with intraday trade expected between 1.3420 and 1.3475. The prior bullish view has faded after a break of 1.3450 support, and the pair is now seen in a 1.3385–1.3495 range. Over 1–3 months, broader supports lie at 1.3210 and 1.3160.
Pound loses momentum and consolidates"24-HOUR VIEW: We expected GBP to “trade in a range between 1.3450 and 1.3520” last Friday. We did not expect GBP to drop to 1.3427. Despite the decline, there has been no clear increase in downward momentum and the current price movements are likely part of a range-trading phase, expected to be between 1.3420 and 1.3475."
"1-3 WEEKS VIEW: We turned positive on GBP last Thursday (16 Jul, spot at 1.3540), indicating that “the renewed upward momentum suggests that GBP has resumed its advance.” We also indicated that “the level to monitor is 1.3590.” On Friday, GBP fell and broke below our ‘strong support’ level at 1.3450. The build-up in momentum has faded, and GBP has likely entered a range-trading phase between 1.3385 and 1.3495."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
US Dollar Technical Analysis: Last week could’ve been much worse for the USD given the below-expected CPI and PPI prints, but so far it’s held support at prior resistance. USD/JPY retains bullish breakout potential and that’s probably one of the more attractive bullish majors for the USD this week, while GBP/USD retains bullish potential itself setting up as one of the more attractive for USD-weakness. The big part of the DXY basket is in view this week with the ECB rate decision and EUR/USD has seen the sell-off stall over the past few weeks, with 1.1500 as a major barrier level on pullback scenarios.
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.
USD Last week was one of those episodes where it could’ve went very differently for the US Dollar, as below-expected CPI and PPI highlighted less urgency for the rate hikes that have been priced in for later this year.
That has not come to pass, however, as the Tuesday and Wednesday pullback led to a rally in the Greenback, and so far this week, that move has continued. From the weekly chart below we can see the DXY basket holding support at prior resistance and this again points to bullish technical structure.
For this week, the big item is the European Central Bank rate decision and the EUR/USD pair remains in an unsettled place, as the bearish trend and fresh lows have been on pause for the past few weeks, but buyers have seemingly been unable to prod for re-test of the 1.1500 handle. That will likely be the big driver for the USD for this week.
US Dollar Weekly Price Chart Chart prepared by James Stanley; data derived from Tradingview EUR/USD In last week’s USD webinar, I looked at three different resistance areas in EUR/USD, and so far the most nearby has held the highs at 1.1469. But the bigger question is whether there’s now enough motivation from bears to finally break through to a fresh low, as that’s been the lacking component going back to late-June and while the daily chart looks messy, the weekly chart highlights this well. This is why we have the old saying in charting of ‘when in doubt, zoom out.’
EUR/USD Weekly Chart Chart prepared by James Stanley; data derived from Tradingview EUR/USD Daily From the daily chart we can see that counter-trend motive well and while messy, this can be argued as a bear flag type of formation given the bullish counter-trend grind over the past few weeks.
Given the ECB meeting on the calendar, this would seem opportune time for the larger trend to present itself, which would point to further DXY strength as the Euro is a whopping 57.6% of the DXY basket. The next resistance level up, the price that bulls have not wanted to encroach upon yet since breaking below a moth ago, is at the 1.1500 level.
EUR/USD Daily Chart Chart prepared by James Stanley; data derived from Tradingview USD/JPY The Japanese Yen is the second largest component of the DXY basket and the Japanese Yen weakness theme remains as a big part of the relative strength in the USD. At this point, the USD/JPY pair holds an ascending triangle formation, which is a bullish breakout formation that points to the possibility of topside breakouts and trend continuation.
As looked at last week, the 165 level is the next major level up and that’s a price that hasn’t traded in USD/JPY since 1986. But – central to that bullish reaction in DXY after PPI and CPI was a similar outing in USD/JPY, and I had looked at this possibility on Monday, highlighting that trend traders could view that weakness as opportunity, which so far they have.
USD/JPY Daily Price Chart Chart prepared by James Stanley; data derived from Tradingview GBP/USD While the EUR/USD sell-off has stalled over the past few weeks but the pair showing an inability to climb above 1.1500, GBP/USD has sprung into what could be argued as a bullish trend given a recent higher-high.
I looked into the pair last week and highlighted three support areas. The first of those areas has so far helped to hold the lows around 1.3450. The second, just below, spans from a Fibonacci level at 1.3390 up to 1.3400, and the third is a prior swing around 1.3325.
For those looking to take bearish stances on the USD this stands out as one of the more attractive major pairs currently available.
GBP/USD Daily Price Chart Chart prepared by James Stanley; data derived from Tradingview --- written by James Stanley, Senior Market Analyst, Global Macro
The GBP/USD pair bounced from recent lows near 1.3450, maintaining an underlying three-week winning streak despite recent consecutive daily losses Measured investor optimism surrounding newly appointed Prime Minister Andy Burnham and structural fiscal prudence are acting as strong tailwinds for sterling A resilient UK economy and a softening US dollar, weighed down by expected Federal Reserve policy pauses, offer immediate dip-buying opportunities for bulls The British pound has shown resilience in foreign exchange markets, maintaining a three-week winning streak despite recent losses. The GBP/USD pair has moved back upward today, recovering from lows near 1.3450 to around 1.3468.
The British pound has demonstrated notable resilience in foreign exchange markets. Despite recording losses in the last two trading sessions, it maintains a three-week winning streak.
So what is actually holding this momentum together, and does it point to something durable, or just a currency pair catching its breath?
Politics Has Done a Lot of the Heavy Lifting Sterling’s strength mostly comes from domestic politics, not anything happening in Washington. Three weeks ago, then-Prime Minister Keir Starmer resigned. Traders had been pricing in a hefty political risk premium since talk of instability began, but as that uncertainty eased, the pound quietly clawed back its losses.
Andy Burnham took over as the UK’s seventh Prime Minister in a decade this Monday. Markets expect him to appoint a fiscally conservative chancellor, a move that’s helped keep sterling well supported. Less political noise, simply put, means more room for the currency to run.
The financial world expects the new administration to stick to a fiscally prudent path. This has really boosted confidence in the currency. The minor profit-taking late last week was just a healthy pause as traders braced for the official transition.
Macroeconomic Resilience and a Faltering Dollar Sterling’s gains didn’t happen in a vacuum. A softer US dollar played a part too. Doubts about how fast the Federal Reserve will tighten, along with a disappointing June Nonfarm Payrolls report, have periodically weighed on the greenback and given cable room to climb.
But the dollar hasn’t been a one-way loser. Escalating US-Iran tensions, including a ninth straight night of US strikes and retaliatory attacks from Iran over the weekend, have kept some safe-haven demand for the dollar alive. Rising oil prices, linked to those tensions, have also fed inflation worries and revived bets on at least one more Fed rate hike this year.
What Does This Say About the Near-Term Outlook? The current trend favors the pound, but the situation is not entirely one-sided. The GBP/USD remains below its early July high, indicating that the dollar could strengthen, particularly if geopolitical risks increase.
This week’s calendar could be the real decider. UK employment data comes out Tuesday, with inflation figures following on Wednesday. Either report could sway the Bank of England’s next move and the pound’s trajectory.
Is There an Opportunity Here? For short-term forex traders, the current market presents a clear strategy. Sterling is expected to perform well as long as domestic politics remain stable. However, this strategy requires careful risk management due to the dollar’s sensitivity to Middle East developments and Federal Reserve policy expectations.
Those following monitoring markets may find opportunities in short-term trading, especially around significant economic data releases. Longer-term investors might consider the pound’s resilience as a sign of underlying value, particularly if the UK economy shows broader stabilization.
What is the near-term outlook for sterling?
The near-term outlook for sterling appears constructive, with trading likely to remain within a range. Upside potential may emerge if UK economic data proves resilient leading up to Bank of England decisions.
Are there opportunities in current GBP strength?
Yes, for momentum traders around data events. Longer-term investors could see potential if the UK recovery continues, especially if the US dollar faces downward pressure.
What could determine the pound’s direction this week?
This week, the direction of the pound could be influenced by UK employment data on Tuesday and inflation figures on Wednesday.
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GBP/USD Rises as Markets Await Burnham's First Cabinet GBP/USD is edging higher on Monday, adding to last week’s gains as Andy Burnham prepares to replace Keir Starmer as UK Prime Minister.
Investors will be watching today's Cabinet announcement and Burnham's first major speech for clues on the new government's fiscal priorities.
Particular attention will be on whether Shabana Mahmood is confirmed as Chancellor. She is viewed by markets as a centrist, and her appointment would reassure investors that Burnham is not looking to ramp up spending or pursue the more expansionary fiscal policies some had feared.
Even so, uncertainty remains over Burnham's broader economic agenda. Fiscal credibility is likely to remain central to market sentiment, helping to keep gilt yields contained and providing support for sterling.
Alongside domestic politics, this is a busy week for UK economic data, with labour market figures due on Tuesday, inflation on Wednesday and retail sales on Friday.
The unemployment rate is expected to remain unchanged at 4.9%, while CPI inflation is forecast to ease to 2.4% from 2.8%, which could lower BoE rate hike expectations.
However, any improvement in inflation may prove temporary. Oil prices have continued to rise following renewed U.S.-Iran hostilities, increasing the risk that higher energy costs feed through into inflation over the coming months.
A softer-than-expected inflation reading could weigh on sterling in the near term, although stronger retail sales—supported by warmer weather and the FIFA World Cup—could provide some offset.
Meanwhile, the U.S. dollar remains under pressure following softer-than-expected CPI and PPI data earlier this month. However, rising oil prices could revive inflation concerns, supporting Treasury yields, Federal Reserve rate expectations and safe-haven demand for the dollar.
GBP/USD Forecast – Technical Analysis
GBP/USD has recovered from the 1.3200 support zone, rising above the 200-day EMA to a high of 1.3550 before pulling back below the former trendline support, which has now become resistance.
Buyers will need to reclaim 1.3485, where horizontal resistance coincides with the falling trendline. A move above this level would bring 1.3550 back into focus before exposing the 1.3600 psychological level.
Failure to reclaim 1.3485 could see the pair retest the 200-day SMA around 1.3390.
Below there, 1.3340 becomes the next key support level, with a break exposing the 1.3200 support zone.
Gold Holds Near Two-Week Low as Higher Oil Prices Revive Inflation Concerns Gold is little changed on Monday as investors assess the impact of escalating Middle East tensions, which continue to push oil prices higher and strengthen the case for the Federal Reserve to maintain a hawkish policy stance.
The precious metal fell 2.5% last week and is broadly unchanged so far in July after declining for four consecutive months, losing almost 25% over that period.
The outlook remains challenging following last week's 15% surge in oil prices, with crude extending gains at the start of this week as U.S. forces carry out strikes against Iran for a ninth consecutive day and concerns persist over shipping through the Strait of Hormuz.
As long as the conflict continues to support higher energy prices, investors are likely to remain concerned that inflation could prove more persistent, delaying any shift towards easier Federal Reserve policy.
That backdrop is weighing on non-yielding assets such as gold.
Cleveland Federal Reserve President Beth Hammack was the latest policymaker to suggest that further interest rate increases may still be required if inflation fails to ease sufficiently.
Markets are now pricing an 82% probability of a Federal Reserve rate hike by December, up from 73% a week ago, according to the CME FedWatch Tool.
One supportive factor for gold has been continued central bank buying.
Purchases by the People's Bank of China accelerated in June, marking the largest monthly increase in three years and extending its buying streak to 20 consecutive months.
For now, the $4,000 level continues to provide support.
With little major U.S. economic data due this week ahead of next week's Federal Reserve meeting, traders are likely to remain focused on developments in the Middle East, oil prices and their implications for inflation.
Gold Forecast – Technical Analysis
Gold has broken below its symmetrical triangle pattern and the 200-day EMA, falling to a low of 3,940.
The price remains below the falling trendline as well as both the 50-day and 200-day EMAs, reinforcing the bearish technical picture. The 50-day EMA has also crossed below the 200-day EMA, generating a bearish crossover signal.
A break below 3,940 would expose 3,800, followed by 3,700.
To improve the outlook, buyers would first need to reclaim 4,100 before targeting 4,200, where the falling trendline and the July high converge.
A move above this resistance would expose the 200-day EMA around 4,310, followed by the June swing high near 4,370.
Only a sustained break above those levels would bring 4,500 back into focus.
Dollar Index Price Chart – Source: Tradingview The US dollar trades near 100.75 on the 4-hour chart following a relief from near 100.35 last week. Price has a clear trendline overhead that caps the move, plus price trades near and below 50-EMA (100.84) & 100-EMA (100.84), so the overall near-term move seems still under pressure despite the recent relief.
The first resistance is at 100.89, which is the trendline and at the 61.8% retracement level. If price can sustain a move past 100.89, the target will be 101.03, then 101.22, and 101.46. The nearest support is at 100.69. Further support will be near 100.61, 100.51, then the recent support near 100.35. The RSI is at about 49 and it indicates that the market momentum is balanced at current price as the buyers and sellers are having equal strength at this time.
For now, my view is that DXY is consolidating beneath the resistance and trendline. If price can get above the trendline, then the chance of broader recovery will get more favorable. If sellers push price away from current level, then there will be higher chance of seeing another test of 100.61 and 100.35 support.
GBP/USD Technical Analysis: Bullish Structure Above The Rising Trendline
The Pound to Dollar (GBP/USD) exchange rate climbed to a two-month high last week as softer-than-expected US inflation weakened the US Dollar while speculation over the UK’s next Chancellor boosted Sterling.
At the time of writing, GBP/USD was trading around $1.3443, up approximately 0.3% on the week after slipping back from a high of $1.3556.
Latest — Exchange Rates:
Pound to Dollar (GBP/USD): 1.345377 (-0.17%)
Euro to Dollar (EUR/USD): 1.143775 (-0.06%)
Dollar to Yen (USD/JPY): 162.4012 (+0.01%)
DAILY RECAP:
The US Dollar (USD) got off to a positive start last week as renewed hostilities in the Gulf prompted investors to favour safe-haven assets.
However, the ‘Greenback’ struggled to hold onto these gains after the release of a softer-than-expected US inflation report.
June's CPI figures showed price pressures eased more rapidly than forecast, with both headline and core inflation coming in below market expectations.
This triggered a sharp drop in the US Dollar as USD investors rushed to reprice some of their more hawkish Federal Reserve interest rate expectations.
The second half of the week then saw the US Dollar claw back some of these losses as a global tech stock selloff revived demand for the safe-haven currency.
Meanwhile, a lack of data left the Pound (GBP) adrift through the first half of last week's session, with cautious remarks from Bank of England Governor Andrew Bailey contributing to the sluggish start.
Sterling's performance then improved dramatically on Wednesday, with GBP/USD being propelled to a new two-month high as rumours began circulating that incoming Prime Minister Andy Burnham was favouring Shabana Mahmood for the Chancellor role over Ed Miliband.
GBP investors, who view Mahmood as a safer, more fiscally disciplined choice, rushed back into the UK currency on the news.
Yet, Sterling's spike quickly evaporated as investors seized the opportunity to lock in quick profits, completely washing out any support the Pound might have gathered from May's bounce in UK GDP.
Near-Term GBP/USD Forecast: Cabinet Appointments and Crucial Data to Stoke Sterling Volatility Turning to this week's session, the initial policy steps and personnel choices of the newly appointed Burnham administration are set to dictate the direction of the Pound to US Dollar exchange rate at the start of the week.
Markets will be closely watching to see who Burnham ultimately picks to lead the Treasury, with the Pound potentially rallying if the new Chancellor aligns with a business-friendly, fiscally cautious agenda.
Beyond politics, a barrage of heavy-hitting UK economic data is also set to influence Sterling sentiment, with GBP investors set to dissect the latest jobs report and inflation print to gauge whether the BoE will feel pressured to alter its current path on interest rates.
Meanwhile, in the absence of any notable US economic indicators, movement in the US Dollar is likely to be tied to market risk dynamics. If tensions in the Middle East continue to escalate, it boosts the chances of investors favouring the safe-haven currency.
