**GBP/USD Technical Analysis: GBP/USD Traded to a New Session High**
*Originally reported by Adam Lemon*
The GBP/USD currency pair saw notable movement in recent trading sessions, capturing the attention of forex traders and investors alike. Adam Lemon’s recent technical analysis on InvestingLive.com breaks down the developments, highlights significant price levels, and charts potential future trajectories for the pair. This extended analysis will summarize and expand upon his insights to provide a comprehensive outlook for GBP/USD.
—
## Overview of Recent GBP/USD Price Action
The GBP/USD pair, frequently dubbed “Cable” on trading floors, traded to a new session high, reflecting a burst of sterling strength against the US dollar. This move culminated after a period of consolidation, with both technical and fundamental drivers at play.
### Key Points from Recent Price Action:
– GBP/USD steadily gained throughout the trading session, testing—and briefly surpassing—important resistance levels.
– The pair’s upward momentum was fueled in part by risk-on sentiment in broader markets and some US dollar weakness.
– Short-term traders were attentive to both price action and key economic data releases, particularly regarding Bank of England (BoE) and Federal Reserve policy expectations.
## Technical Analysis: Support and Resistance Levels
According to Lemon’s analysis, several technical factors warrant consideration for those trading or tracking GBP/USD. Here are the technical highlights:
### Primary Resistance Levels:
– The immediate resistance was observed near 1.2800, an area of prior price congestion and recent intraday highs.
– Should the pair breach this resistance, the next significant target sits near 1.2850, a psychological round number.
– Further resistance may emerge at 1.2900, where sellers have previously intervened and which coincides with longer-term moving average resistance.
### Key Support Levels:
– Pullbacks are likely to find initial support near 1.2750, where buy orders have clustered on recent dips.
– A break below this could expose the 1.2700-1.2720 area, a zone of prior price reactions and the locus of several technical retracement levels.
– Stronger support is identified between 1.2660 and 1.2680—a region where bulls have repeatedly defended their positions during previous selloffs.
### Chart Patterns and Momentum
Several technical signals reinforce the bullish narrative:
– Trendline analysis shows the pair maintaining upward bias since bouncing from late May lows.
– Shorter-term moving averages—such as the 20- and 50-period EMAs—show GBP/USD above these lines, indicating sustained bullish momentum.
– Momentum indicators, notably the RSI (Relative Strength Index), approached but did not breach overbought territory, suggesting the uptrend has space to run if fundamentals cooperate.
## Fundamental Drivers Behind Recent GBP/USD Moves
Beyond the technical landscape, fundamental developments have played a crucial role in influencing GBP/USD momentum.
### Factors Supporting GBP/USD Strength:
– Growing optimism over the UK’s macroeconomic outlook, as recent data indicated resilience in growth and employment.
– Diminished expectations for imminent rate hikes in the United States, causing dollar weakness.
– Improved risk appetite in global financial markets, reducing safe-haven demand for the dollar.
### Key Events Impacting GBP/USD:
– Traders closely monitored the Federal Reserve’s monetary policy statements and US macroeconomic prints, especially inflation and labor market data.
– Focus also rested on data and commentary from the Bank of England, including inflation projections and policy rate guidance.
### Upcoming Economic Catalysts
Both sterling and the dollar are likely to react to major releases scheduled in coming sessions. The following events are expected to inject volatility:
– UK GDP and inflation data: Strong figures could push GBP/USD higher, while disappointments may spark renewed selling.
– US inflation reports and jobs data: These releases are critical for shaping the Fed’s rate outlook and, by extension, dollar sentiment.
– Central bank commentary from both the BoE and the Fed: Forward guidance and policy shifts can quickly alter the
Read more on GBP/USD trading.