Over the past 24 to 48 hours, the GBP/USD pair has shown firm strength, consistently holding above the key 1.3500 level with modest fluctuations. The closing price yesterday was 1.35019, indicating a steady performance of the British Pound against the US Dollar in recent sessions.

The driving forces behind this bullish momentum are market expectations of possible Federal Reserve easing and the cautious stance taken by the Bank of England (BoE). The Fed is widely anticipated to slow down its rate hike cycle or even consider rate cuts, undermining the US Dollar’s appeal and supporting the Pound. Meanwhile, the BoE’s relatively hawkish but careful approach to monetary policy has further encouraged investors to remain bullish on the Pound.

Within this context, GBP/USD has successfully breached and sustained levels above 1.3500, reaching a three-month high. This reflects growing investor confidence in the UK’s stable economic growth, particularly supported by steady Q3 GDP figures. Additionally, the UK equity market has shown resilience, with the FTSE100 index rising by about 20% this year, lending extra support to the Pound.

For the average investor, the recent strength in GBP/USD can be understood as the market’s reaction to the Fed’s easing prospects paired with the BoE’s cautious tone. In this scenario, the Pound demonstrates relative attractiveness, offering a favorable trading opportunity for those considering forex positions in GBP/USD.

Daily Chart

The GBPUSD daily chart shows a mild upward trend, with prices rebounding from below the 50-day moving average and hovering near the 200-day moving average, indicating that long-term bullish momentum is not fully established yet. The Bollinger Bands are slightly narrowing, indicating reduced short-term volatility, while the MACD indicator is converging upward, suggesting increasing buying pressure. Overall, the daily setup indicates the market is at a pivotal point, with a likely attempt to breach the 1.35 psychological level.

1H Chart

Over the past 3 to 5 days, the GBPUSD hourly chart reveals a strong rebound, with prices consistently above key moving averages. The MACD has recently formed a bullish crossover, signaling strong short-term momentum. Bollinger Bands are expanding, indicating potential increased volatility ahead. A recently forming bullish flag pattern suggests further upside potential in the short term. The critical breakout level is near 1.352, and traders should monitor volume to confirm the strength of any breakout.

Technical Trend:  GBPUSD is currently in a cautiously bullish phase, exhibiting a moderate upward trend with relatively stable short-term conditions, favoring a cautiously optimistic outlook.

Technically, GBPUSD on the daily chart is showing signs of recovery, with the MACD gradually shifting to bullish territory, indicating buyers are gaining control. The hourly chart’s bullish flag offers a potential entry point; if prices break above the flag’s resistance near 1.352, short-term bullish momentum may extend further. The newly identified support and resistance zones provide traders clear levels for risk management. Attention should be on whether the 1.35 level holds, as it serves as a critical psychological and technical barrier.

The only significant economic event today is the speech by the Bank of Japan Governor Ueda, which has limited direct impact on the GBPUSD pair, as it primarily involves Japanese Yen movements. With no major US or UK economic data scheduled, the GBPUSD price action is expected to be mainly influenced by market sentiment and technical factors in the short term.

Resistance & Support

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