**GBP/USD Forex Signal Loses Momentum Ahead of FOMC Minutes**
*By Crispus Nyaga, as originally published on InsuranceNewsNet.com*
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**Overview**
The GBP/USD currency pair has experienced a marked decline in momentum as traders look ahead to the release of the Federal Open Market Committee (FOMC) minutes. The forex market, which had shown some resilience earlier in the week, is now treading cautiously, with the pound losing strength against a firmer dollar. This article analyzes the current price action of GBP/USD, explores the fundamental factors driving sentiment, and examines possible scenarios following the upcoming FOMC minutes.
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**Recent GBP/USD Performance**
The GBP/USD pair started the week with moderate gains, buoyed by a relatively upbeat risk mood and tepid greenback. However, the upward trajectory lost steam as investors repositioned themselves ahead of key U.S. economic data and the FOMC release.
– **Early Week Strength:** The pound managed to push higher amid soft U.S. data, hopes of a dovish Federal Reserve, and stabilizing risk sentiment.
– **Loss of Momentum:** The upward push stalled, and cable began to trade in a tight, consolidative range as the dollar rebounded.
– **Current Levels:** At the time of publication, GBP/USD was hovering near the 1.2500 mark—a psychological support level that continues to attract significant attention.
**Technical Analysis**
From a technical perspective, GBP/USD’s loss of momentum has manifested in a breakdown of critical support zones and the emergence of bearish patterns.
– **Key Resistance:** The pair faces resistance at 1.2570 and 1.2600—levels that have capped rallies in previous sessions.
– **Support Levels:** Immediate support sits at 1.2490, with a more crucial floor at 1.2450. A breach below these levels could trigger a deeper pullback toward 1.2400 or lower.
– **Moving Averages:** The pair is now trading below its 20-period and 50-period moving averages (on the 4-hour chart), further signaling a bearish bias in the short term.
– **Oscillators:** The Relative Strength Index (RSI) has drifted toward the 45-50 zone, suggesting weakening bullish pressure but not yet reaching oversold territory.
**Market Sentiment and Positioning**
Investor sentiment toward GBP/USD is increasingly cautious as uncertainty grows around U.S. monetary policy, global growth prospects, and the UK’s own economic trajectory.
– **Positioning:** Hedge funds and other institutional traders have reduced their long GBP bets as the dollar regains footing.
– **Options Markets:** The pricing of GBP/USD options reflects heightened volatility in the near term, with risk reversals favoring dollar strength.
– **Order Flow:** Market participants are reportedly lightening up positions ahead of the FOMC event, resulting in thinning liquidity and amplifying short-term swings.
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**Fundamental Drivers of GBP/USD
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