During the mid-North American session, the Pound Sterling faced downward pressure, experiencing losses against the US Dollar, as it dipped below the key psychological level of 1.2500. Data from the United States revealed a pickup in inflation, which dampened expectations of potential interest rate cuts by the Federal Reserve.
The GBP/USD pair traded at 1.2481, marking a decline of 0.27% from its previous level.
Technical Analysis of GBP/USD:
Despite the GBP/USD’s recent streak of three consecutive days of gains, the overall technical outlook remains bearish, with buyers failing to breach significant resistance at the 200-day moving average (DMA) situated at 1.2557. The failure to surpass this level exposed the vulnerability of the pair, resulting in its decline below the critical 1.2500 level, exacerbated by fundamental news.
Should the GBP/USD conclude Friday’s session around the 1.2480 mark, it would form a ‘dark cloud cover’ pattern, signaling potential further losses. The next support levels to watch for would be at 1.2400, followed by the year-to-date (YTD) low at 1.2300.
Conversely, a resurgence in buying pressure lifting the spot price above 1.2500 would pave the way for a challenge towards the 200-DMA, offering a potential shift in the bearish momentum.
