British Pound Short-term Outlook: GBP/USD Selloff Breaks June Uptrend

British Pound Technical Outlook: GBP/USD Short-Term Trade Levels

GBP/USD has plunged more than 2.5% from the August high with the decline breaking the June uptrend
Sterling has declined in four of the past five weeks, with the September opening-range break driving price below the 200-day moving average for the first time since July.
Daily momentum is showing possible divergence on the latest drop, highlighting the risk for near-term exhaustion.
A break below the May swing low would strengthen the case for another leg lower, while a recovery through near-term resistance would begin to ease immediate downside pressure.
UK and U.S. PMI data highlight near-term event risk as markets assess the growth outlook following last week’s central-bank decisions.
Resistance 1.3400/08, 1.3465/74 (key), 1.3558- Support 1.3302 (key), 1.3255, 1.3187/94

Sterling remains under pressure after last month’s rally failed to sustain a push through major resistance. The subsequent decline has materially weakened the near-term technical backdrop, with GBP/USD now approaching an important support region as momentum begins to show signs of strain. With the major central-bank decisions behind us, the focus shifts to whether sellers can maintain control or the latest leg lower begins to exhaust into the weekly close. Battle lines drawn on the GBP/USD short-term technical charts.

Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Sterling technical setup and more. Join live on Monday’s at 8:30am EST.

British Pound Price Chart – GBP/USD Daily

Chart Prepared by Michael Boutros, Sr. Technical Strategist; GBP/USD on TradingView

Technical Outlook: In last month’s British Pound Short-term Outlook we noted that GBP/USD had, “rallied 1.8% off the monthly low with the bulls now testing resistance at three-month highs. Risk for some kickback here but the medium-term outlook remains constructive while above the yearly open. From a trading standpoint, losses should be limited to 1.3558 IF Sterling is heading higher on this stretch with a breach / close above 1.3658 needed to mark uptrend resumption.” The bulls briefly registered an intraday high at 1.3675 the following day before exhausting into the close of August with the subsequent decline breaking below key support on the heels of the FOMC last week.

The selloff has broken the June uptrend with GBP/USD plunging more than 2.5% from the August high. Sterling is attempting to break the 61.8% retracement of the June rally today at 1.3345 and the bears will need to secure a daily close below this level to keep the immediate short viable. Note that daily momentum is flagging possible divergence on this latest drop and highlights the threat for near-term exhaustion in the days ahead.

British Pound Price Chart – GBP/USD 240min

Chart Prepared by Michael Boutros, Sr. Technical Strategist; GBP/USD on TradingView

Notes: A closer look at Sterling price action shows GBP/USD trading within the confines of a descending channel formation extending off the August high. Initial support is now in view at the May swing low at 1.3302. Note that the lower parallel converges on this level over the next few days and a break / daily close below would be needed to fuel he next major leg of the decline. Subsequent support objectives rest at 78.6% retracement at 1.3255 with the next major technical consideration seen at the March low close and the 38.2% retracement of the broader 2025 advance at 1.3187/94- look for a larger reaction there IF reached.

Initial resistance is eyed at weekly high and the 50% retracement near 1.3400/08. Key resistance and near-term bearish invalidation is now eyed at the February low-day close (LDC) and the 2026 yearly open at 1.3465/74. A breach / daily close above this threshold would be needed to suggest a more significant low is in place, and a larger trend reversal is underway. Subsequent resistance objectives are eyed at the July high near 1.3558 and the 61.8% retracement of the yearly range and the 2025 May / August highs at 1.3591/93.

Bottom line: GBP/USD has declined in four of the past five weeks, with the latest selloff driving Sterling below the 200-day moving average for the first time since July. The immediate focus is on today’s close with respect to 1.3345. From a trading standpoint, rallies would need to be limited to 1.3408 IF price is heading lower on this stretch with a close below 1.3302 needed to fuel the next major leg of the decline.

Attention for GBP/USD shifts to flash Manufacturing and Services PMI figures from both the UK and U.S., offering a fresh read on economic momentum following last week’s Fed and Bank of England decisions. Markets will also be closely watching Thursday’s meeting between President Trump and Chinese President Xi Jinping, where any progress—or renewed friction—on trade, tariffs, critical-mineral supply chains, investment, and AI could drive broader risk sentiment and U.S. dollar volatility. With the major policy decisions now behind us, the combination of incoming growth data and geopolitical headlines could keep GBP/USD volatility elevated into the weekly close. Stay nimble into the releases and watch the weekly close for directional guidance. Review my latest British Pound Weekly Forecast for a closer look at the longer-term GBP/USD technical trade levels.

Key GBP/USD Economic Data Releases

Active Short-term Technical Charts

--- Written by Michael Boutros, Senior Technical Strategist

Follow Michael on X @MBForex

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