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GBP/USD Enters The GDP Test On The Back Foot

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Aayush Jindal

Key Highlights

  • GBP/USD failed to clear 1.3500 and started a downside correction.
  • It traded below a bullish trend line with support at 1.3360 on the 4-hour chart.
  • EUR/USD declined below 1.1100 to enter the red zone.
  • WTI Crude Oil prices could extend losses if there is a move below $84.50.

GBP/USD Technical Analysis

The British Pound struggled to stay above 1.3420 against the US Dollar. GBP/USD started a downside correction and traded below 1.3350.

Looking at the 4-hour chart, the pair traded below a bullish trend line with support at 1.3360. The pair settled below 1.3320, the 100 simple moving average (red, 4-hour), and the 200 simple moving average (green, 4-hour).

The pair traded as low as 1.3252, and it is now consolidating losses. If there is a recovery wave, the pair could face resistance near the 23.6% Fib retracement level of the downward move from the 1.3459 swing high to the 1.3252 low.

On the upside, the first major resistance might be 1.3330. The main resistance could be 1.3380 and the 100 simple moving average (red, 4-hour). A close above 1.3380 could start a steady increase. In the stated case, the pair might revisit the key hurdle at 1.3500.

If the bears remain in action, the pair could drop toward the 1.3200 level. The first major support might be 1.3140. A close below 1.3140 might accelerate the decline. In the stated case, the pair might drop to 1.3000.

Looking at EUR/USD, the pair extended losses and now there could be a move below 1.1060 in the near term.

Upcoming Key Economic Events:

  • UK GDP for Q3 2026 (Preliminary) (QoQ) - Forecast +0.7%, versus +0.5% previous.
  • UK Industrial Production for Sep 2026 (MoM) - Forecast -0.3%, versus +0.8% previous.
  • UK Manufacturing Production for Sep 2026 (MoM) - Forecast -0.5%, versus +1.2% previous.
  • US Initial Jobless Claims - Forecast 195K, versus 189K previous.
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