CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Create Account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Create Account
✖

GBP/USD Halts Selloff to Carve Bullish Engulfing Candlestick

Article By: ,  Strategist
February 11, 2025 9:25 PM

US Dollar Outlook: GBP/USD

GBP/USD bounces back from a fresh weekly low (1.2333) to halt a three-day selloff, and the exchange rate may attempt to retrace the decline from the monthly high (1.2550) as it seems to be carving a bullish engulfing candlestick formation.

GBP/USD Halts Selloff to Carve Bullish Engulfing Candlestick

GBP/USD retraces the decline from the start of the week as Federal Reserve Jerome Powell tells US lawmakers that ‘we do not need to be in a hurry to adjust our policy stance’, and it seems as though the Federal Open Market Committee (FOMC) will gradually move towards a neutral stance despite the ongoing change in US trade policy.

Join David Song for the Weekly Fundamental Market Outlook webinar.

David provides a market overview and takes questions in real-time. Register Here

 

In turn, the US Dollar may face headwinds ahead of the next Fed meeting in March as the central bank appears to be on track to implement lower interest rates in 2025, and data prints coming out of the US may fuel the recent rebound in GBP/USD as the Consumer Price Index (CPI) is anticipated to show easing inflation.

US Economic Calendar

Even though the headline CPI is seen holding steady at 2.9% in January, the core rate is expected to narrow to 3.1% from 3.2% per annum the month prior, and indications of slowing price growth may produce a bearish reaction in the US Dollar as it fuels speculation for an imminent Fed rate-cut.

However, a higher-than-expected CPI print may push the FOMC to further combat inflation, and signs of persistent price growth may curb the recent rebound in GBP/USD as it raises the central bank’s scope to keep US interest rates on hold.

With that said, GBP/USD may continue to track the negative slope in the 50-Day SMA (1.2485) amid the failed attempt to close above the moving average, but the exchange rate may stage further attempts to test the January high (1.2576) should it push above the opening range for February.

GBP/USD Price Chart –Daily

Chart Prepared by David Song, Senior Strategist; GBP/USD on TradingView

  • A bullish engulfing candlestick formation takes shape as GBP/USD climbs to a fresh weekly high (1.2430), with a break/close above the 1.2390 (38.2% Fibonacci extension) to 1.2446 (May low) zone bringing the monthly high (1.2550) on the radar.
  • A breach above the January high (1.2576) opens up the 1.2710 (23.6% Fibonacci extension) to 1.2760 (61.8% Fibonacci retracement) region, but lack of momentum to break/close above the 1.2390 (38.2% Fibonacci extension) to 1.2446 (May low) zone may keep GBP/USD below the 50-Day SMA (1.2485).
  • Failure to hold above the 1.2300 (50% Fibonacci retracement) to 1.2310 (61.8% Fibonacci extension) region may push GBP/USD towards the monthly low (1.2249), with the next area of interest coming in around the January low (1.2100).

Additional Market Outlooks

USD/JPY Rebound Keeps RSI Above Oversold Zone Ahead of Fed Testimony

Canadian Dollar Forecast: USD/CAD Remains Susceptible to Trump Tariffs

GBP/USD Vulnerable amid Failure to Close Above 50-Day SMA

AUD/USD Recovery Stalls Ahead of January High

--- Written by David Song, Senior Strategist

Follow on Twitter at @DavidJSong

StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation.

StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67.6% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Please ensure you fully understand the risks involved by reading our full risk warning.

FOREX.com is a trading name of StoneX Europe Limited, and FOREX.com/ie is a domain operated by StoneX Europe Ltd, a member of StoneX Group Inc. StoneX Europe Ltd, is a Cyprus Investment Firm (CIF) company registered to the Department of Registrar of Companies and Official Receiver with a Registration Number HE409708, and authorized and regulated by the Cyprus Securities & Exchange Commission (CySEC) under license number 400/21. StoneX Europe is a Member of the Investor Compensation Fund (ICF) and has its registered address at Nikokreontos 2, 5th Floor, 1066 Nicosia, Cyprus.

FOREX.com is a trademark of StoneX Europe Ltd, a member of StoneX Group Inc.

This website uses cookies to provide you with the very best experience and to know you better. By visiting our website with your browser set to allow cookies, you consent to our use of cookies as described in our Privacy Policy.

Through passporting, StoneX Europe is allowed to provide its services and products on a cross-border basis to the following European Economic Area ("EEA") states: Austria, Bulgaria, Croatia, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.

StoneX Europe Ltd products, services and information are not intended for residents other than the ones stated above.

StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation. StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.

© FOREX.COM 2025