GBP/USD outlook: Bulls hold grip ahead of UK GDP data

Slobodan Drvenica Windsor Brokers

GBP/USD

Cable keeps firm near term tone and extends recovery after Tuesday’s 1% rally generated positive signal on over 50% retracement of 1.3444/1.3139 pullback and completion of bullish engulfing pattern on daily chart.

Fresh extension higher on Wednesday rose above Fibo 61.8% retracement that adds to development of reversal signal, after strong bounce on Tuesday signaled that corrective phase from new 2025 high (1.3444) is likely over.

Formation of bear-trap under Fibo 38.2% of 1.3444/1.3139 contributes to positive near-term outlook, along with predominantly bullish daily studies.

Traders focus on tomorrow’s releases of UK GDP data, with expectations for 0.6% growth in Q1 being significantly above 0.1% growth in the first three months of 2024, although economists see flat growth in March compared to 0.5% expansion in the previous month.

Sterling would benefit from better than expected GDP data that would also ease pressure on BOE to cut rates again in June (bets for June cut have dropped significantly after May’s hawkish cut).

Also, a trade deal with the US would ease uncertainty and improve economic situation on removing one of major obstacles for economic growth.

Res: 1.3360; 1.3402; 1.3444; 1.3500.
Sup: 1.3270; 1.3232; 1.3200; 1.3162.

Interested in GBP/USD technicals? Check out the key levels

1. R3 1.3504
2. R2 1.341
3. R1 1.3358
PP 1.3264
1. S1 1.3211
2. S2 1.3117
3. S3 1.3065

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

GBP/USD defends 1.3300 after strong UK PMI data

Following Thursday's sharp decline, GBP/USD clings to small gains above 1.3300 in the American session on Friday, supported by the upbeat UK Retail Sales and July PMI data. Nevertheless, the pair's upside remains capped as investors cling to a cautious stance amid a further escalation of tensions in the Middle East. The US July PMI data failed to trigger relevant price action.

EUR/USD remains below 1.1400 after mixed US PMIs

EUR/USD pressures daily lows below the 1.1400 mark in the American session on Friday. Mixed S&P Global PMIs, as manufacturing output contracted while services activity expanded in July, triggered no relevant market reaction. The focus remains in Middle East developments and inflation-related concerns.

Gold holds above $4,050 but momentum still missing

Gold builds on its modest intraday bounce and climbs above the $4,050 level on Friday, hitting a fresh daily high amid a modest US Dollar pullback. The fundamental backdrop, however, warrants some caution before confirming that the pullback from an over two-week high, touched on Wednesday, has run its course and positioning for any meaningful upside.

Ethereum: Derivatives interest in ETH improves, but signs of caution remain

Ethereum is hovering slightly below the $1,900 level, down 3% on Thursday following a slight expansion in derivatives interest. The top altcoin's open interest has increased to 14.60 million ETH, marking a 600K ETH increase over the past two days and its highest level since June 7.

Crypto Market Overview: Bitcoin tests 50-day EMA support – Pi Network and Sky lead losses

The broader cryptocurrency market faces headwinds with rising tensions between the US and Iran, pushing Bitcoin down to its 50-day Exponential Moving Average support around $65,135 on Friday. Under pressure, Pi Network and Sky emerge as the worst-performing crypto assets over the last 24 hours.

US Dollar mid-year outlook: Exceptional currency, exceptional risks?

The US Dollar enters the second half of 2026 in a markedly different position from a year ago. The King currency has recovered, reflecting persistent US inflation, changing expectations for Fed policy, geopolitical tensions and renewed demand for defensive assets.