**GBP/USD Forecast: 20 October 2025 — Analyzing the Technical Landscape**
*Article by Adam Lemon, adapted and expanded with credit to DailyForex.com*
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The GBP/USD currency pair, widely known as ‘Cable,’ remains pivotal to the global Forex landscape. As we approach the final quarter of 2025, traders, investors, and analysts alike are closely monitoring the pair’s volatility in response to central bank decisions, economic data releases, and geopolitical developments on both sides of the Atlantic. Building on the recent analysis by Adam Lemon at DailyForex.com, this article provides an in-depth technical overview, key market drivers, and an actionable outlook for the coming weeks.
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## Recent Performance Overview
The British Pound to US Dollar exchange rate has encountered significant turbulence throughout the past several months. The pair’s movements have been largely channeled by monetary policy divergences between the Federal Reserve and the Bank of England, wage inflation in the UK, and shifting market sentiment toward risk assets.
– **Current Trading Range:** GBP/USD has oscillated within the 1.2000 to 1.2500 corridor for much of late 2025, reflecting periods of risk aversion and broad US Dollar strength.
– **Recent Trend:** The pair has witnessed several failed attempts to sustain rallies above the 1.2400 handle, with buyers struggling against periodic surges in USD demand.
## Technical Analysis for GBP/USD
Analysing the daily chart, several key indicators and technical patterns offer insights into Cable’s immediate prospects.
### 1. Support and Resistance Levels
– **Immediate Resistance:** 1.2380 to 1.2420 zone. Sellers have stepped in aggressively around these levels, leading to sharp reversals in recent sessions.
– **Major Support:** The 1.2100 psychological mark stands out as a strong floor where buyers have historically defended further downside.
### 2. Moving Averages
– **50-Day Simple Moving Average (SMA):** Currently hovering near 1.2315, this moving average has acted as dynamic resistance in recent weeks.
– **200-Day SMA:** The longer-term trend remains tilted lower with bearish momentum, as the pair trades beneath this indicator at 1.2240, underscoring a persistent downtrend bias.
### 3. Chart Patterns
– **Descending Channel:** Since August, GBP/USD has sketched a series of lower highs and lower lows, constructing a well-defined bearish channel.
– **Bearish Engulfing Candle:** Recently, a pronounced bearish engulfing pattern emerged, suggesting the possibility of further declines in the absence of fresh bullish catalysts.
### 4. Oscillators
– **Relative Strength Index (RSI):** The RSI is trending near 42 on the daily chart, remaining below the midline but not yet in oversold territory. This suggests downside risk remains but could slow if sellers lose steam.
– **MACD Indicator:** The MACD remains below the signal line, reinforcing the signal that bearish momentum is not yet exhausted.
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## Macro-Fundamental Background
While technicals provide context for immediate price action, the underlying macro narrative is also critical in shaping GBP/USD dynamics.
### UK Economic Landscape
– **Inflation Trends:** UK inflation remains above the Bank of England’s target, complicating rate policy decisions. Persistent services inflation and wage growth are retaining pressure on BOE officials to maintain a hawkish bias, even as headline consumer price increases show some moderation.
– **Employment Data:** Labour market robustness continues to provide temporary support for Sterling, but recent forward-looking indicators have hinted at a slowdown in hiring, raising concerns about future economic growth.
– **Political Environment:** The UK remains encumbered by post-Brexit adjustments, trade negotiations, and a looming general election expected in 2026. Uncertainty around fiscal policy and regulatory changes continues to cap Sterling’s medium-term gains.
### US Economic Context
– **Federal Reserve Policy:** The Fed
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