**The GBP/USD Is Breaking Critical Support: Technical Analysis and Outlook
By Economies.com, as originally reported at Economies.com**
*(Credit: Economies.com, Analysis 29-07-2025)*
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The British pound sterling’s performance against the United States dollar (GBP/USD) remains a focal point for forex traders worldwide. Recent price movements have indicated critical changes in underlying trends, with technical indicators signaling that the pound is breaching significant support zones that could trigger further downside. This article delves into the latest developments, key technical levels, potential scenarios, and strategic insights for GBP/USD trading as analyzed by Economies.com on July 29, 2025.
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**1. Overview of Recent GBP/USD Price Action**
The GBP/USD currency pair has experienced increasing volatility amid shifting economic data from both the United Kingdom and the United States. As of the latest session, bears have taken control, driving the pair lower and pushing GBP/USD below a historically significant support level. The break below this threshold has piqued the interest of technical traders and market participants watching for signs of a sustained move or a potential reversal.
Key factors influencing recent action:
– Persistent US dollar strength due to positive economic indicators and expectations regarding Federal Reserve policy.
– Uncertainties over the UK’s economic outlook, with concerns about growth and political stability undermining the pound’s appeal.
– A broader risk-off sentiment in global markets, prompting investors to favor safe-haven currency positions.
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**2. Technical Breakdown: Breaking Critical Support**
According to the analysis published by Economies.com, the GBP/USD pair is exhibiting clear technical signals that point to a possible extension of the prevailing bearish trend. The key technical aspects include:
– **Break of Major Support:** The GBP/USD pair decisively broke below the critical support zone at 1.2650, a level that had previously functioned as a floor for prices over several weeks. This breakdown indicates increased selling pressure and a lack of strong buying interest at these levels.
– **Momentum Indicators:** Oscillators such as the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) have tilted bearish. The RSI is trending lower, confirming strengthening downside momentum, while the MACD has printed a negative crossover.
– **Bearish Candlestick Patterns:** On the daily chart, successive bearish candles with significant volume reflect the dominance of sellers and imply the potential for follow-through to the downside.
– **Moving Averages:** The 50-period and 100-period moving averages now act as overhead resistance after previously supporting the uptrend. The price is trading well below these averages, confirming the technical breakdown.
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**3. Key Levels to Watch**
Understanding critical price levels helps traders anticipate possible market reactions. Here are the main technical zones highlighted in the Economies.com analysis:
*Support Levels:*
– **1.2590:** The immediate support post-break; price action here will indicate whether selling continues.
– **1.2500:** A psychological round figure and a potential area for buyers to re-enter the market if the fall accelerates.
– **1.2450:** A lower support region seen as the next logical downside target if bearish momentum persists.
*Resistance Levels:*
– **1.2650:** The recently broken support, now likely to operate as resistance upon any upward retracement.
– **1.2730:** An additional resistance area, aligning with the 50-period moving average and prior swing highs.
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**4. Technical Indicators and Patterns**
A range of technical indicators supports the current bearish bias:
– **RSI (Relative Strength Index)**
– The RSI has fallen below the 50-level, pointing to a strengthening bearish trend. Should the RSI approach oversold levels (below 30), a brief corrective bounce could be expected, though any such move would be viewed within the broader context of a declining market.
– **MACD (Moving Average Convergence Divergence)**
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