FX.co ★ GBP/USD

The British pound against the US dollar (GBP/USD) has fallen for the third consecutive day—marking a decline in five of the last six sessions—and reached a four-week low during Thursday’s Asian trading session. The spot price is currently hovering just above the 1.3250 level, pressured by a strong US dollar. This decline follows better-than-expected US consumer inflation data released on Tuesday, coupled with hawkish remarks from several Federal Reserve officials, which have reinforced market expectations for continued monetary policy tightening. In fact, interest-rate futures traders have begun increasing their bets on a potential 50-basis-point rate hike at the Federal Open Market Committee (FOMC) meeting scheduled for December. These hawkish expectations—compounded by ongoing geopolitical uncertainty in the Middle East, which has boosted demand for safe-haven assets—have pushed the US dollar to its highest level since April 2025 (a 19-month high), exerting significant downward pressure on the GBP/USD exchange rate. Nevertheless, the hawkish monetary policy stance maintained by the Bank of England has provided fundamental support for the British pound, helping to mitigate the risk of further sharp declines in the currency pair. Earlier this month, the Bank of England raised interest rates for the first time in three years, and it now faces pressure to further tighten monetary policy; the market widely anticipates a high probability of another rate hike in December. This is primarily due to the strength of the British economy, which continues to outperform other European economies, bolstered by technology-driven investments. Nevertheless, traders remain cautious ahead of a series of key UK macroeconomic data releases—including monthly and quarterly GDP figures—and are hesitant to take aggressive, one-sided positions. These data points will provide crucial insights into the momentum of the UK’s domestic growth and could serve as a primary catalyst for price movements in the near term. From a technical analysis perspective, the GBP/USD exchange rate fell below the psychological 1.3300 level overnight, also breaching the 61.8% Fibonacci retracement level of the upward move that began from the October lows—a clear bearish signal. On the four-hour chart, the price is currently trading below the downward-sloping 100-period simple moving average (SMA) (currently at 1.3381), which reinforces the short-term bearish trend. Given the previous failure of buyers to sustain the key 1.3500 level, the broader technical outlook for the GBP/USD pair remains decidedly bearish. Momentum indicators also support this bearish outlook: the 14-period Relative Strength Index (RSI) is hovering around 26—within the oversold zone—indicating that downward pressure has reached an extreme level, though no clear reversal signal has emerged yet. Meanwhile, the Moving Average Convergence Divergence (MACD) remains below the zero line, reflecting a negative reading and a weak trend. Consequently, sellers are likely to target the 1.3216 level (the 78.6% Fibonacci retracement level); should this level be broken, stronger structural support would be found near the recent cycle low of 1.3138. Conversely, if the exchange rate experiences a corrective rebound, it will immediately encounter dynamic resistance around 1.3278 (the 61.8% Fibonacci retracement level). Further gains would lead to a series of resistance levels, including the 50.0% Fibonacci retracement (1.3321) and the 38.2% Fibonacci retracement (1.3364). Furthermore, the 100-period Simple Moving Average (1.3381) and the 23.6% Fibonacci retracement level (1.3417) together form a robust resistance zone; as long as the exchange rate remains below this technical "ceiling," any rebound attempts will likely be suppressed.