FX.co ★ GBP/USD at resistance

The GBP/USD pair rebounded and now is located at 1.2486 at the time of writing. It has dropped as much as 1.2433 today, registering a new low. Technically, today's high of 1.2511 stands as a key upside obstacle. Today, the fundamentals moved the rate.

The price dropped after the UK GDP reported a 0.5% drop, more compared to the 0.2% drop forecasted. In addition, the UK Industrial Production, Index of Services, and Construction Output reported poor data as well.

As expected, the US inflation figures brought high volatility and sharp movements on both sides. As you already know, the US CPI and Core CPI indicators reported higher inflation in August. As a first reaction, the GBP/USD pair dropped, but now it has erased the losses.

GBP/USD Under Strong Upside Pressure!

The bias remains bearish as long as it stays below the downtrend line. Today's breakout was invalidated for now. Today's high of 1.2511 and the weekly pivot point of 1.2520 represent key upside obstacles.

Only false breakouts through the downtrend line may announce a new sell-off. Still, the false breakdown with great separation below 1.2445 indicated exhausted sellers.

GBP/USD Outlook!

A new higher high, a bullish closure above 1.2511 and beyond the weekly pivot point of 1.2520 is seen as a new buying signal with a first upside target at the weekly R1 (1.2590).