**GBP Price Forecast: Pound Rebounds to 1.3360 — Technical Analysis and Market Outlook**
*By TradingNews Analysis Team*
The British Pound (GBP) staged a notable recovery against the US Dollar (USD) this week, climbing back to the 1.3360 level after recent declines. The rebound in the GBP/USD pair comes amid a shifting backdrop of economic data, central bank commentary, and evolving risk sentiment across global markets. This article provides a comprehensive analysis of the pound’s price action, the technical and fundamental drivers influencing its trajectory, and what traders can expect in the near term. All insights are based on the thorough and original reporting by the TradingNews Analysis Team.
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### Pound Rebounds: Overview of the Recent Rally
The GBP/USD currency pair experienced a sharp bounce this week, reversing a portion of last week’s losses to trade near the 1.3360 mark. Several underlying factors contributed to this resurgence:
– **Diminished US Dollar Strength:** The USD recently paused its months-long rally as US Treasury yields stabilized.
– **Hawkish Bank of England Tone:** BOE policymakers signaled concerns over persistent inflation, igniting speculation around further monetary tightening.
– **Sentiment Shifts:** Markets saw improved appetite for risk, supporting sterling and other risk-sensitive currencies.
In the aftermath of disappointing UK GDP data last week and global risk aversion, the pound drifted lower and was testing key technical levels near 1.3200. The recovery to 1.3360 marks a clear technical rebound, but questions remain about how sustainable this move will be.
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### Key Drivers Behind the Pound’s Recovery
**1. Moderation in USD Strength**
The recent uptick in the pound versus the dollar is tied closely to movements in the greenback. Several USD-bullish factors have rotated out of focus:
– Expectations for aggressive rate cuts from the Federal Reserve have been dampened by robust US economic data. However, this week saw less hawkish rhetoric and a stabilization in yields.
– Markets have partially priced out extreme tail risks in the US economy and are seeking opportunities in alternative currencies.
This moderation helped major G10 currencies, including the pound, find their footing.
**2. BOE’s Cautious but Hawkish Outlook**
The Bank of England has adopted a more measured approach to policy than the Federal Reserve, reflecting:
– A nuanced inflation outlook. While UK inflation has cooled from multi-decade highs, BOE officials, including Governor Andrew Bailey, said there are “no guarantees” that price pressures will abate as quickly as markets hope.
– Sticky wage growth and a tight labor market. These factors support the case for maintaining higher rates for longer.
Traders interpreted recent speeches as evidence the BOE remains alert to upside inflation risks, giving the pound an edge versus other low-yielding currencies.
**3. Improvement in Global Risk Sentiment**
– Global equities stabilized after a volatile start to the quarter.
– European data releases for purchasing manager indices and investor confidence slightly exceeded forecasts.
– The pound, often considered a bellwether for risk sentiment among major currencies, benefited from rotation out of the safe-haven dollar.
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### Technical Analysis: GBP/USD Rebounds to Key Resistance
The pound’s rally to 1.3360 is significant from both a short-term trading and longer-term chart perspective.
**Support and Resistance Levels**
Key support and resistance areas are as follows:
– Immediate resistance: 1.3360 (current level and previous swing high)
– Further resistance: 1.3410 and 1.3500
– Immediate support: 1.3300 and 1.3250
– Critical support: 1.3200 (recent lows and 200-day simple moving average)
**Momentum Indicators**
– Relative Strength Index (RSI) moved up from near-oversold territory but remains neutral (~51), signaling room for further upside.
– MACD (Moving Average
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