Select Language

GBP/USD Price Forecast: The potential support level to watch is near 1.2600

blockHeadVisual
  1. HOME
  2. Get information
  3. World FX news
  4. GBP/USD Price Forecast: The potential support level to watch is near 1.2600

World FX news

search
Breaking news

GBP/USD Price Forecast: The potential support level to watch is near 1.2600

  • X
  • facebook
  • LINE
  • RSS
  • X
  • facebook
  • LINE
  • RSS
New update 2024.12.02 16:00
GBP/USD Price Forecast: The potential support level to watch is near 1.2600

update 2024.12.02 16:00

  • GBP/USD trades in the negative territory around 1.2700 in Monday's early European session. 
  • The negative outlook of the pair remains intact below the 100-day EMA, with a bearish RSI indicator. 
  • The first downside target to watch is the 1.2600 psychological level; the immediate resistance level is seen at 1.2834. 

The GBP/USD pair tumbles to near 1.2700 during the early European session on Monday, pressured by the firmer US Dollar (USD) broadly. The US President-elect Donald Trump's tariff threats, the rising geopolitical tensions in West Asia and the rising expectation for less aggressive Fed rate cuts support the Greenback and act as a headwind for GBP/USD. The release of US ISM Manufacturing Purchasing Managers Index (PMI) data will be the highlight on Monday. 

Technically, the negative view of GBP/USD prevails, with the price holding below the key 100-day Exponential Moving Average (EMA) on the daily chart. The downward momentum of the major pair is reinforced by the 14-day Relative Strength Index (RSI), which stands below the midline around 44.40. 

The initial support level for GBP/USD emerges at the 1.2600 psychological level. Sustained bearish momentum could drag the major pair to the lower limit of the Bollinger Band at 1.2445. A break below this level could push prices lower toward 1.2331, the low of April 23.  

On the bright side, the first upside barrier is located at 1.2834, the low of November 6. Extended gains above this level could pave the way for a test of the 1.2890-1.2900 zone, representing the round mark and the 100-day EMA. The psychological level and the upper boundary of the Bollinger Band of 1.3000 appear to be a tough nut to crack for bulls.  

GBP/USD daily chart

Pound Sterling FAQs

The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as 'Cable', which accounts for 11% of FX, GBP/JPY, or the 'Dragon' as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE).

The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of "price stability" - a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects.

Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall.

Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

 

Date

Created

 : 2024.12.02

Update

Last updated

 : 2024.12.02

Related articles

Show more

Writer

FXStreet

Financial media

arrow
FXStreet

FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.

Was this article helpful?
No loading Yes loading

We hope you find this article useful. Any comments or suggestions will be greatly appreciated.  
We are also looking for writers with extensive experience in forex and crypto to join us.

please contact us at [email protected].

Thank you for your feedback.
Thank you for your feedback.

Previous article

prev

ECB's Kazaks: In my view, rate cuts must continue

Next article

Forex Today: US Dollar rebounds as December gets underway with high-tier data releases

prev

Most viewed

Silver price today: Silver falls, according to FXStreet data

Most recent article: Silver price today: Silver falls, according to FXStreet data Silver prices (XAG/USD) fell on Monday, according to FXStreet data.
New
update2024.12.02 18:30

Pound Sterling loses 1.2700 level against US Dollar after Trump defends USD dominance

The Pound Sterling (GBP) pulls back below the 1.2700 mark on Monday after more invective from President-elect Donald Trump bolsters the US Dollar (USD).
New
update2024.12.02 18:17

Forex Today: US Dollar rebounds as December gets underway with high-tier data releases

Here is what you need to know on Monday, December 2: The US Dollar (USD) gathers strength against its major rivals to begin the month of December.
New
update2024.12.02 16:06

GBP/USD Price Forecast: The potential support level to watch is near 1.2600

The GBP/USD pair tumbles to near 1.2700 during the early European session on Monday, pressured by the firmer US Dollar (USD) broadly.
New
update2024.12.02 15:59

ECB's Kazaks: In my view, rate cuts must continue

European Central Bank (ECB) policymaker Martins Kazaks said on Monday, "in my view, rate cuts must continue." He added that "we see that the inflation problem will soon end." Market reaction The above comments fail to affect the Euro , as EUR/USD loses 0.48% on the day to trade near 1.0525, at the press time.
New
update2024.12.02 15:29

FX option expiries for Dec 2 NY cut

FX option expiries for Dec 2 NY cut at 10:00 Eastern Time via DTCC can be found below.
New
update2024.12.02 15:04

WTI remains below $68.50 amid firmer US Dollar, OPEC+ meeting in focus

West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $68.25 on Monday.
New
update2024.12.02 14:59

AUD/USD slides back below 0.6500 on US-China trade war fears, notable USD strength

The AUD/USD pair starts a new week/month on a weaker note and slides back below the 0.6500 psychological mark during the Asian session, snapping a three-day winning streak.
New
update2024.12.02 14:46

ECB's Lane: At some point, policy needs to be driven by upcoming risks

"At some point, policy needs to be driven by upcoming risks rather than being backward-looking," European Central Bank (ECB) Chief Economist Phillip Lane said in a Financial Times (FT) interview on Monday.
New
update2024.12.02 14:40

Gold price remains heavily offered amid renewed USD buying interest

Gold price attracts heavy selling at the start of a new week/month and drops to the $2,623-2,622 area during the Asian session, snapping a four-day winning streak amid a goodish pickup in the US Dollar (USD) demand.
New
update2024.12.02 14:11

Disclaimer:arw

All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.

The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.

arw
  • Facebook
  • Twitter
  • LINE

Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy

I agree
share
Share
Line

Line
Facebook

Facebook
X

Twitter
Cancel