Over the past 24 to 48 hours, the GBP/USD exchange rate moved within a narrow range, holding steady around 1.346, essentially unchanged from yesterday’s close at 1.34673. This consolidation reflects a cautious market sentiment as traders enter the new year, awaiting the release of the Federal Reserve’s (FOMC) meeting minutes for clearer guidance on future policy. These minutes are expected to have a significant impact on the US dollar’s trajectory, subsequently influencing the GBP/USD pair.

Recently, the US dollar has faced downward pressure throughout 2025, losing some of its dominant status, while the British Pound has found support amid signals of cautious easing from the Bank of England (BoE). Although GBP/USD experienced slight pullbacks in the short term, the overall trend remains bullish. The pound’s steadiness at year-end underscores investors’ heightened focus on the directions of UK economic policy and US monetary policy.

In simpler terms for the average investor, the current GBP/USD market is like waiting for an important announcement. Once the Fed delivers clear signals, the exchange rate could experience significant volatility. This serves as a reminder to stay vigilant and closely monitor market developments and central bank cues to make timely investment decisions.

Daily Chart

The GBPUSD daily chart illustrates a gradual and steady upward movement from recent bottoming, indicating a bullish trend over the longer term. The 50-day moving average has crossed above the 200-day moving average, forming a bullish golden cross. Bollinger Bands have contracted, signaling reduced volatility with prices consolidating near the middle band. The MACD remains above the zero line with a potential crossover signaling strengthening momentum. Overall, the daily structure supports continuation of the uptrend, though short-term pullbacks are possible.

1H Chart

The hourly chart of GBPUSD over the past 3-5 days shows consolidation in a range with price testing and pulling back from the 1.3450 level. The 20 and 50 EMA are closely aligned providing near-term support. Bollinger Bands indicate price frequently touching the middle band, trading within the bands. MACD displays slight bearish divergence, hinting at short-term corrective pressure. The recent bearish engulfing candlestick pattern suggests increased selling pressure in the next 24 hours; watching for the range to hold will be critical to determine short-term direction.

Technical Trend:  GBPUSD currently exhibits a cautiously bullish trend, characterized by stable upward momentum punctuated by short-term consolidation phases. The market can be described as steady bullish.

Key technical insights include a bullish golden cross on the daily chart indicating sustained medium to long-term bullish momentum. The hourly chart’s bearish engulfing candlestick signals short-term selling pressure, warranting caution. MACD indicators across daily and hourly timeframes signal potential momentum shifts post-FOMC release. The contracting Bollinger Bands indicate low volatility awaiting a breakout. Traders should monitor the critical support near 1.3440 and resistance at 1.3500. A breakout of these levels could trigger a significant move in either direction.

Today’s economic calendar has no major UK-specific releases directly impacting GBPUSD. The primary focus is on the US Federal Reserve’s FOMC minutes scheduled at 20:00 GMT+1 (03:00 HKT). The minutes will significantly influence the USD’s strength and, by extension, GBPUSD’s direction. Dovish tones could bolster GBPUSD, while hawkish signals may weigh on it. Other economic data such as US housing indices and manufacturing data have limited direct impact on GBPUSD today. Therefore, the FOMC minutes remain the key event for traders to watch.

Resistance & Support

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