Pound Sterling Price News and Forecast: GBP gains against US Dollar in light volume conditions

FXStreet Team FXStreet

Pound Sterling gains against US Dollar in light volume conditions before New Year

The Pound Sterling (GBP) rises to near 1.2600 against the US Dollar (USD) at the start of the week. However, low volatility is expected from the GBP/USD pair due to thin trading volume conditions before New Year celebrations. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, drops below 108.00 but is set to end the year with almost 6.7% gains.

The USD performed strongly this year even though the Federal Reserve (Fed) reduced its key borrowing rates by 100 basis points (bps) to 4.25%-4.50%. The Greenback has gained significantly in the last three months after Republican Donald Trump’s victory in the United States (US) Presidential election as policies such as immigration control, higher import tariffs, and lower taxes are expected to be inflationary and pro-growth. Read more...

Technical analysis: GBP/USD holds above 1.25 but weak bullish bias

GBP/USD has managed to hold above the 1.2500 mark this week following last week’s post-Fed tumble that pulled the pair to the lowest since May, hitting 1.2474. The slide reinforced the medium-term downtrend line as a strong resistance wall, but now the bulls face additional barriers.

Any recovery attempt would first need to overcome the 61.8% Fibonacci retracement of the November-December upleg at 1.2610 and then battle the 20-day simple moving average (SMA) at 1.2663 before cracking the descending trendline. Read more...

Author

FXStreet Team

FXStreet

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD retreats below 1.1750 on modest USD recovery

EUR/USD stays under modest bearish pressure and trades below 1.1750 on Friday. Although trading conditions remain thin following the New Year holiday and ahead of the weekend, the modest recovery seen in the US Dollar causes the pair to edge lower. The economic calendar will not feature any high-impact data releases.

GBP/USD struggles to gain traction, stabilizes above 1.3450

After testing 1.3400 on the last day of 2025, GBP/USD managed to stage a rebound. Nevertheless, the pair finds it difficult to gather momentum and moves sideways above 1.3450 as market participants remain in holiday mood.

Gold climbs toward $4,400 following deep correction

Gold reverses its direction and advances toward $4,400 after suffering heavy losses amid profit-taking before the New Year holiday. Growing expectations for a dovish Fed policy and persistent geopolitical risks seem to be helping XAU/USD stretch higher.

Cardano gains early New Year momentum, bulls target falling wedge breakout

Cardano kicks off the New Year on a positive note and is extending gains, trading above $0.36 at the time of writing on Friday. Improving on-chain and derivatives data point to growing bullish interest, while the technical outlook keeps an upside breakout in focus.

Economic outlook 2026-2027 in advanced countries: Solidity test

After a year marked by global economic resilience and ending on a note of optimism, 2026 looks promising and could be a year of solid economic performance. In our baseline scenario, we expect most of the supportive factors at work in 2025 to continue to play a role in 2026.

Crypto market outlook for 2026

Year 2025 was volatile, as crypto often is. Among positive catalysts were favourable regulatory changes in the U.S., rise of Digital Asset Treasuries (DAT), adoption of AI and tokenization of Real-World-Assets (RWA).