GBP/USD outlook: Recovery picks up and cracks pivotal barriers, ahead of FOMC decision

Slobodan Drvenica Windsor Brokers

GBP/USD

GBP/USD extends recovery into second consecutive day and cracks important barriers at 1.2700/14 (psychological / 10DMA), but without break higher so far.

Monday’s bounce generated initial positive signal on completion of bullish engulfing pattern on daily chart, with today’s fresh extension higher, looking for sustained break above 1.2700/14 pivots to confirm signal and open way for further recovery.

Broader technical picture is predominantly bearish and warning about possible recovery may stall (south-heading 14-d momentum is approaching the centreline, MA’s mainly in bearish setup and converging 55/200DMA on track to for a death cross).

Such scenario could be well supported by anticipated Fed’s hawkish cut on Wednesday, as the US central bank may reduce the speed and diverge from expected rate cut path in 2025, due to new reality (inflation remains elevated and may rise further on expected strong boost to the US economy by Trump’s administration) that would further inflate dollar.

Broken 20DMA (1.2673) offers immediate support, guarding more significant 1.2600 zone (higher base / psychological).

Res: 1.2750; 1.2787; 1.2817; 1.2852

Sup: 1.2673; 1.2617; 1.2600; 1.2565

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

1. R3 1.2799
2. R2 1.2764
3. R1 1.2736
PP 1.2701
1. S1 1.2674
2. S2 1.2639
3. S3 1.2611

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.

EUR/USD clings to modest gains above 1.1550 post-US CPI

EUR/USD stays in positive territory above 1.1550 in the American session on Wednesday. The data from the US showed that the annual CPI inflation climbed to 4.2% in May. This print came in line with the market expectation and made it difficult for the USD to gather strength.

GBP/USD pulls away from session highs, stays above 1.3400

GBP/USD stays in positive territory slightly above 1.3400 despite pulling away from session highs. The cautious market stance helps the US Dollar limit its losses and cap the pair's upside as investors assess the US inflation data, which showed that the CPI rose 4.2% on a yearly basis in May.

Gold trades at fresh 10-week low below $4,200

Gold builds on Tuesday’s losses and remains under heavy pressure, gyrating around the $4,150 mark per troy ounce as investors evaluate the latest US CPI data on Wednesday. Meanwhile, developments from the Middle East crisis and the likelihood of a more cautious Fed in the next few months continue to weigh on the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP face downside pressure amid investor de-risking

Major crypto assets trade under intense headwinds on Wednesday, as market participants navigate complex geopolitical and macroeconomic environments.

Brutal sell-off: Silver deepens months-long slide, refocusing on $60

Silver has never been known for its calm temperament. The precious metal can spend weeks grinding higher before suddenly giving back months of gains in a matter of days. That volatile reputation has been on full display in recent weeks.

The US economy defies the rules: 100 days into the Oil shock and the recession signal is still missing

More than three months after the start of the Iran war and the resulting disruption to global energy markets, the US economy continues to display remarkable resilience. The conflict has triggered a sharp rise in Oil prices, reignited inflationary pressures and fueled widespread concerns about a potential economic slowdown.