**GBP/USD Price Forecast: Immediate Resistance Level Emerges above 1.3450**
*By FXStreet Editorial Team*
The GBP/USD currency pair, often referred to as “Cable,” has marked dynamic movement in the Forex market recently, capturing significant interest from both retail and institutional traders. As of the latest sessions, the pair approaches a vital technical juncture, with 1.3450 emerging as an immediate resistance level that could shape near-term direction. This article analyzes the recent performance, fundamental backdrop, and technical outlook for GBP/USD, providing traders with insights for informed decision-making.
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**Recent Performance Overview**
– GBP/USD has seen a consistent recovery after recent lows, buoyed by shifts in risk sentiment and fundamental catalysts from both the UK and the US.
– The pair’s trajectory has been influenced by changing expectations surrounding Bank of England (BoE) and Federal Reserve (Fed) monetary policies.
– Market volatility around key economic releases has fueled short-term movements, causing traders to pay careful attention to major resistance and support zones.
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**Fundamental Backdrop**
*UK Developments:*
– The UK economy has displayed signs of resilience, with recent data on employment and inflation surprising markets on the upside.
– Persistent inflation pressures have raised expectations that the BoE may pursue further tightening, lending support to the British Pound.
– Ongoing Brexit-related headlines, particularly regarding Northern Ireland trade arrangements and broader UK-EU relations, have intermittently weighed on GBP sentiment.
– Political uncertainties, such as upcoming elections or fiscal policy adjustments, remain a background risk to watch.
*US Developments:*
– The Federal Reserve’s monetary policy stance has stayed hawkish despite softer inflation prints, signaled by ongoing comments from key policymakers.
– US labor market data remain robust, but some indicators now hint at a possible cooling, pressuring the US Dollar.
– Shifting treasury yields have had a notable impact on overall USD strength or weakness, which directly feeds into the performance of GBP/USD.
– Market speculation over the timing and magnitude of Fed rate cuts has introduced waves of volatility.
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**Technical Analysis**
– GBP/USD recently tested the 1.3450 level, a crucial resistance turned focal point for both bears and bulls.
– The pair is trading above short-term moving averages, reflecting upward momentum in the near term.
– Immediate technical indicators suggest room for further gains, but crossing 1.3450 and holding above it is vital for confirming a bullish breakout.
**Key Technical Levels to Watch:**
– *Immediate Resistance*: 1.3450
– *Next Resistance*: 1.3480, followed by 1.3520
– *Initial Support*: 1.3400
– *Strong Support*: 1.3360
**Technical Indicators:**
– The Relative Strength Index (RSI) remains in bullish territory but is not yet overbought, indicating potential for additional gains.
– MACD histogram builds on positive momentum, suggesting continuing buyer interest.
– The 50-period Simple Moving Average (SMA) on the 4-hour chart provides short-term support, aligning with bullish technical sentiment.
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**Market Sentiment and Positioning**
– Recent upticks in Cable reflect stronger appetite for riskier assets. This improved sentiment relates in part to global equity market gains and less aggressive Fed rate hike expectations.
– Commitment of Traders (COT) data indicates that institutional players remain net long on GBP, though the margin has narrowed in recent sessions.
– Retail traders appear to be increasing their net short positions, providing contrarian fuel for further gains should resistance levels give way.
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**Scenarios for GBP/USD**
**Bullish Case**
– If GBP/USD sustains buying pressure above 1.3450, momentum could extend towards higher resistance levels at 1.3480 and 1.3520.
– A confirmed break and hold above 1.3520 would open the door to a test of psychological levels near 1.3600
Read more on GBP/USD trading.