British Pound Technical Forecast: GBP/USD Weekly Trade Levels
- British Pound post-Fed sell-off approaching attempting to break to fresh monthly lows
- GBP/USD key support now in view- Major U.S. inflation data on tap tomorrow, NFPs next week
- Resistance 1.3434/69 (key), 1.3648/50, 1.3749- Support 1.3267/80 (key), 1.3140/44, 1.3056/80
Sterling is poised to mark a second consecutive-weekly decline with GBP/USD attempting to break to fresh monthly lows today. The post-Fed reversal is now approaching technical support at a multi-year slope and the battle lines drawn on the Sterling weekly technical chart heading into key inflation data tomorrow.
British Pound Price Chart – GBP/USD Weekly
Chart Prepared by Michael Boutros, Sr. Technical Strategist; GBP/USD on TradingView
Technical Outlook: In my last British Pound Weekly Forecast we noted that a rebound off slope support kept the focus on a potential breakout and that, “From a trading standpoint, losses should be limited to the median-line IF price is heading higher on this stretch with a breach / close above 1.3650 needed to fuel the next leg of the advance.” GBP/USD surged nearly 3% off the September low with the rally briefly registering an intraday high at 1.3726 on the heels of the Fed rate decision. Price failed to mark a close above resistance with an outside daily / weekly reversal off the highs now extending more than 2.8%.
Initial weekly support rests with the 78.6% retracement of the August rally / the August low-week close at 1.3267/80- note that the median-line converges on this threshold over the next few weeks and a break / close below this threshold is needed to suggest a more significant high was registered last week and that a lager trend reversal is underway. Subsequent support objectives rests with the 38.2% retracement of the yearly range / May low / 2023 high at 1.3140/44 and 1.3056/80- a region defined by the 52-week moving average and the 100% extension of the June decline. Look for a larger reaction there IF reached.
Initial weekly resistance now eyed at the 2024 high / September high-week close (HWC) at 1.3434/69. The threat remains tilted to the downside while below this threshold with key resistance steady at the 2025 HWC / 78.6% retracement of the June decline at 1.3648/50- a breach / close above this threshold would threaten resumption of the broader uptrend with subsequent resistance objectives eyed at the 2022 high at 1.3749 and the 1.40-handle.
Bottom line: The Fed reversal in GBP/USD is now approaching support at the median-line with major event risk on tap tomorrow. While the near-term risk is weighted to the downside, the decline may be vulnerable into technical support just lower. From a trading standpoint, look to reduce short-exposure heading into slope support- rallies should be limited to 1.3469 IF price is heading lower on this stretch with a close 1.3267 needed to fuel the next major leg of the decline.
Keep in mind we get the release of Core Personal Consumption Expenditures tomorrow morning with Non-Farm Payrolls on tap next week. Stay nimble into the releases and watch the weekly closes for guidance here. Review my latest British Pound Short-term Outlook for a closer look at the near-term GBP/USD technical trade levels.
GBP/USD Economic Data Releases
Economic Calendar - latest economic developments and upcoming event risk.
--- Written by Michael Boutros, Sr Technical Strategist
Follow Michael on X @MBForex
