British Pound Technical Forecast: GBP/USD Coils - Q3 Breakout Levels

British Pound Technical Forecast: GBP/USD Weekly Trade Levels

British Pound breakout of multi-month downtrend attempting to reassert
GBP/USD carving monthly opening-range below yearly high- constructive above 1.24
Sterling resistance 1.2850s, 1.30, 1.3103– support 1.2601, ~1.25, 1.2397

The British Pound is poised to snap a two-week losing streak with GBP/USD trading just below the yearly highs. While a breakout of multi-year downtrend resistance does keep the outlook constructive, the advance has been struggling around a key pivot zone over the past few weeks and the focus now falls to the July opening-range for guidance here. These are the updated targets and invalidation levels that matter on the GBP/USD weekly technical chart.

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British Pound Price Chart – GBP/USD Weekly

Chart Prepared by Michael Boutros, Sr. Technical Strategist; GBP/USD on TradingView

Technical Outlook: In last month’s, British Pound Weekly Forecast we noted that Sterling had faltered at multi-year downtrend resistance with GBP/USD, “decline sitting at support around the January high-week close at 1.2397 for the past three-weeks- price has been unable to mark a weekly close below. . .” Prices surged off that mark the following week with Sterling rallying nearly 4.4% off the May lows and breaching the 2021 trendline.

The advance has been stalled for the past three-week with GBP/USD straddling a key pivot zone at 1.2757/73- a region defined by the 61.8% Fibonacci retracement of the 2021 decline and the February 2019 swing low. A topside breach / close above the June high (~1.2850s) is needed to mark resumption towards subsequent resistance objectives at the 1.30-handle and the 61.8% extension of the 2022 advance at 1.3103.

Weekly support rests with the October channel line / 23.6% retracement of the objective yearly range at 1.2601 backed by the 2021 trendline (currently ~1.25). Broader bullish invalidation now raised to 1.2397.

Bottom line: Sterling is attempting to mount a key resistance hurdle for the past four weeks. From at trading standpoint, a good zone to reduce portions of long-exposure / raise protective stops – losses should be limited to the 1.26-handle IF price is heading higher on this stretch. Note that price is carving the initial monthly opening-range just below resistance and we’ll be looking for the breakout to offer further guidance in the days ahead. I’ll publish an updated British Pound Short-term Outlook once we get further clarity on the near-term GBP/USD technical trade levels.

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--- Written by Michael Boutros, Sr Technical Strategist with FOREX.com

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