British Pound Short-term Outlook: GBP/USD Plunge Pauses at Support Ahead of BoE

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

British Pound attempting to stabilize after dropping more than 3.4% from the late-October high- trading just above pivotal support.
GBP/USD near-term focus is on a possible exhaustion / price inflection from this zone, broader risk still tilted lower while below the monthly open
Resistance 1.3097, 1.3144/51 (key), 1.3207- Support 1.3000/45 (key), 1.2944, 1.2876

The British Pound is showing signs of stabilizing after a six-day decline, with GBP/USD holding just above confluent multi-month downtrend support. While the broader bias remains tilted to the downside, the immediate focus is on a reaction from this zone for guidance into the November opening range. A break and weekly close below this support would risk fueling another leg lower, while a rebound here could offer temporary relief within the broader decline. Battle lines drawn on the Serling 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 my last British Pound Short-term Outlook, we noted that GBP/USD was approaching support and that, “From a trading standpoint, rallies should be limited to 1.3445 IF price is heading lower on this stretch with a close below 1.3267 needed to fuel the next major leg of this decline.” A short-lived rebound failed a few days later with Sterling briefly registering an intraday high at 1.3369 before mounting an outside-day reversal sharply lower. The Fed inspired USD rally further exacerbated the decline with a six-day selloff slamming into a pivotal support zone yesterday. The focus is on a possible reaction off this zone in the days ahead with the broader outlook still tilted to the downside while within the September channel. Note that daily momentum remains deep in oversold territory and continues to favor the bears, for now.

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 pitchfork extending off the October 6 high, with price responding to support today at 1.3000/45- a region defined by the 2024 July high, September low-day close & November high and the 2025 March swing / close highs. The immediate decline may be vulnerable while above this threshold near-term.

Initial resistance is eyed at the October swing low at 1.3097 and is backed by near-term bearish invalidation at the 38.2% retracement of the yearly range and the November open at 1.3144/51. Ultimately, a breach / close above the July low-day close (LDC) at 1.3207 is needed to suggest a more significant low is in place / a larger reversal is underway.

A break below this key pivot zone exposes subsequent support objectives at the 50% retracement at 1.2944, and the 1.618% extension of the September decline at 1.2876- look for a larger reaction there IF reached. Losses below this threshold could fuel another accelerated bout of declines with the next major technical consideration seen at the 2024 yearly open / 61.8% retracement at 1.2731/45.

Bottom line: The British Pound is testing confluent support near the lower bounds of a multi-month downtrend- risk for some kickback here. From a trading standpoint rallies should be limited to the monthly open (1.3251) IF Sterling is heading lower on this stretch with a close below 1.30 needed to fuel the next leg of this decline.

Keep in mind the Bank of England rate decision is on tap tomorrow with markets widely expecting the BoE to leave interest rates unchanged at 4%. The most recent rate cut (August) passed by a 5-4 margin and suggests the central bank may be nearing the end of its easing cycle as inflation remains elevated. Keep an eye on the vote count tomorrow. Stay nimble into the release and watch the weekly closes for guidance here. 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, Sr Technical Strategist

Follow Michael on X @MBForex

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