- GBP/USD retreats from weekly highs, down 0.25%, after testing 1.2700.
- Momentum remains bullish, with potential to test 1.2803 and year-to-date high at 1.2893.
- A further pullback could challenge the support at 1.2634/31 and the 50-day SMA at 1.2594.
The British pound erased Wednesday's gains against the US dollar as investors pushed the currency to fresh weekly highs on developments in disinflation in the United States (US). Although investors are pricing in 38 basis point rate cuts by the Federal Reserve towards the end of the year, the dollar is regaining ground. GBP/USD is trading at 1.2654, down 0.25%.
GBP/USD Price Analysis: Technical Outlook
GBP/USD retreated from weekly highs after briefly testing 1.2700 as buyers failed to decisively break that level, followed by the April 9 high of 1.2709. Despite that, the bullish trend remains intact, with buyers taking a breather.
The momentum, as shown by the RSI, suggests that the bulls are in control, which could lead to further gains.
If buyers manage to reclaim 1.2709, this could potentially open the door to testing 1.2803, the March 21 high, and even the year-to-date high of 1.2893.
On the other hand, a continuation of the pullback witnessed on Thursday could set the stage to challenge the confluence of the May 3 high and the 100-day moving average (DMA) around 1.2634/31 before dipping towards the 50-day SMA at 1.2594.
GBP/USD Price Action – Daily Chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
