Below 1.3300: GBP/USD Price Forecast Suggests Downside Risk as USD Strengthens Ahead of UK GDP

• A third consecutive day of selling weighs on GBP/USD as the USD builds on its post-US CPI gains.
• At its strongest since April 2025, the USD draws support from rising Fed rate-hike expectations and geopolitical risks.
• Further declines in the pair remain supported by a bearish technical picture.

GBP/USD is declining for a third consecutive day. The pair touched a fresh four-week low in Thursday’s Asian session, recording its fifth daily decline in the past six days. Trading just above the mid-1.3200s, spot prices remain exposed to further weakness as bullish sentiment towards the US Dollar (USD) persists.

Expectations of an imminent rate increase were reinforced by hawkish remarks from several Federal Reserve (Fed) officials after Tuesday’s stronger-than-expected US consumer inflation data. Traders have also begun to price in a possible outsized 50-basis-point (bps) hike at the next FOMC meeting in December. Together with uncertainty in the Middle East, these expectations have pushed the USD to its strongest level since April 2025, putting significant pressure on GBP/USD.

Further downside could nevertheless be contained by the Bank of England's (BoE) hawkish position, which may lend support to the British Pound (GBP). Traders also appear reluctant to commit to the next directional move ahead of a batch of UK economic releases, including monthly and quarterly GDP reports.

Bearish traders viewed the sustained overnight breach of 1.3300 and the 61.8% Fibonacci retracement of the advance from October’s lows as an important trigger. The negative technical outlook is reinforced by spot prices remaining below the 100-period Simple Moving Average (SMA), located at 1.3381 on the 4-hour chart. Combined with the recent failure to establish a foothold above 1.3500, these signals indicate that GBP/USD’s path of least resistance is still lower.

Near 26, the Relative Strength Index (RSI) remains in oversold territory. This points to stretched downside conditions, although a clear recovery signal has yet to emerge. The Moving Average Convergence Divergence (MACD) also retains a subdued profile and a negative reading below zero. The indicators therefore support further declines towards the 78.6% Fibonacci retracement at 1.3216. Beyond that lies the next significant support, with the recent cycle low near 1.3138 forming a structural floor.

A corrective rebound would initially meet the 61.8% retracement at 1.3278. Subsequent resistance sits at the 50% level of 1.3321, then the 38.2% retracement at 1.3364. Above those levels, the 100-period SMA at 1.3381 and the 23.6% retracement at 1.3417 add to a broader resistance zone. GBP/USD continues to trade below this cluster.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

4-hour chart: GBP/USD