- GBP/USD attracts some sellers around 1.2525 in Wednesday’s early European session.
- The pair holds above the 50- and 100-hour EMA with an upward slope; the RSI indicator stands in bullish territory above 50.
- 1.2580 acts as an immediate resistance level for GBP/USD; the initial support level is located at 1.2456.
The GBP/USD pair snaps the three-day winning streak during the early European session on Wednesday. The downtick of the major pair is backed by renewed US dollar demand. At the press time, GBP/USD is losing 0.09% on the day to trade at 1.2525.
On Monday, the Bank of England (BoE) Governor Andrew Bailey said that it was too early to think about rate cuts and borrowing costs might have to rise again if inflation proved to be more persistent than estimated. Bailey further stated that the conflict in the Gaza Strip has increased the likelihood that inflation will rise again.
From the technical perspective, GBP/USD holds above the 50- and 100-hour Exponential Moving Averages (EMAs) with an upward slope on the four-hour chart, suggesting the path of least resistance is to the upside. Furthermore, the Relative Strength Index (RSI) holds in the bullish territory above 50, indicating the further upside looks favorable.
The upper boundary of the Bollinger Band at 1.2580 acts as an immediate resistance level for the major pair. The next upside barrier is seen near a high of September 4 at 1.2642. The additional upside filter to watch is a high of September 1 at 1.2713, en route to a high of August 30 at 1.2746.
On the downside, the initial support level for GBP/USD is located near a high of November 16 at 1.2456. Further south, the next downside target is seen at the 50-hour EMA. The key contention level will emerge at 1.2400, portraying the confluence of the lower limit of the Bollinger Band and a psychological round mark. A breach of the level will see a drop to the 100-hour EMA at 1.2357.
GBP/USD four-hour chart
-638362293545191376.png)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD faces strong resistance around 0.6800
Further weakness saw AUD/USD retreat further and add to Monday’s decline in response to the slight advance in the US Dollar and declining prices in the commodity space.
EUR/USD pauses with ECB rate call around the corner
EUR/USD rotated around 1.0900 on Tuesday as markets grappled with September rate cut hopes getting pinned even further into the high end after US Retail Sales figures eased in June. Markets have fully priced in the start of a Fed rate-cutting cycle in September.
Gold reaches fresh record highs above $2,460
Following a short-lasting correction in the early American session, Gold gathers bullish momentum and trades a new all-time high above $2,450. The benchmark 10-year US Treasury bond yield stays in the red near 4.2%, fuelling XAU/USD's rally.
Meme coins rally amidst Ethereum ETF approval hype, PEPE extends gains by 10%
PEPE, a meme coin built on Ethereum, and based on a popular frog-themed meme has rallied in double digits on Tuesday. As crypto market participants await the Securities & Exchange Commission’s approval of a Spot Ethereum ETF, meme coins have started recovering from their decline in the first week of July.
Despite upside surprise, Retail Sales show lost momentum
Despite lower sales at autos dealers and at gas stations, retail spending held steady in June. Excluding those categories, it was the best month since January 2023, and that means upside risk for Q2 consumer spending.