GBP/USD Price Forecast - Pound Range Near 1.3450 As Fed Cut Bets And NFP Keep Bulls In Check

GBP/USD: Range Trade Around 1.3450 As DXY Stalls Below 99 Ahead Of NFP

GBP/USD Overview: Spot Around 1.3450–1.3465 In A 1.3400–1.3565 Range

GBP/USD is trading around 1.3450–1.3465, consolidating after failing to hold the 1.3560–1.3570 high, which was the strongest level since mid-September. The pair is locked in a clear short-term range between support near 1.3400 and resistance at 1.3520–1.3560. On the dollar side, the US Dollar Index (DXY) is hovering around 98.70–98.80, capped by resistance in the 99.05–99.30 zone and supported near 98.50, which keeps GBP/USD stuck in a sideways regime rather than in a trending move.

USD Data Mix: ISM Services At 54.4 Versus JOLTS 7.146M And ADP 41K

The latest US data set is mixed and explains why USD strength is limited. ISM Services PMI jumped from 52.6 to 54.4, beating expectations of 52.3 and confirming solid expansion in the dominant services sector. In contrast, labor indicators softened: JOLTS job openings fell to 7.146 million versus a 7.6 million consensus, and ADP employment rose by just 41,000 jobs versus 47,000 expected after a small decline in the prior month. This combination of resilient activity and weaker hiring keeps the dollar supported but prevents an aggressive upside extension in DXY, which in turn limits how far GBP/USD can be pushed below 1.3400.

Fed Signals: Aggressive Cuts Talk Versus Market Focus On 55K–60K NFP

Fed commentary aligns with the softening labor story. One Fed governor has openly argued for aggressive rate cuts in 2026, while other officials warn the unemployment rate could rise faster than anticipated. Markets now see the Fed closer to easing than tightening. The immediate catalyst is December NFP, where expectations cluster around 55,000–60,000 jobs versus 64,000 in November, with the jobless rate seen around 4.5% compared with 4.6% previously. A downside surprise reinforces the easing narrative and supports GBP/USD; a strong beat would give DXY room to break 99.30 and pressure the pair toward or below 1.3400.

GBP/USD Technicals: Support At 1.3400, Resistance At 1.3520–1.3560, Trend Still Upward-Biased

From a technical standpoint, GBP/USD remains in a constructive range. Price is consolidating after the pullback from 1.3560–1.3570 toward the 1.3450 zone. Multiple readings highlight horizontal support near 1.3400, with demand consistently appearing in the 1.3440–1.3460 band. On short-term charts, the pair trades just above the 200-period moving average, while the 50-period MA has flattened, signaling consolidation rather than a reversal. The RSI sits in the low- to mid-40s, showing cooled momentum without oversold conditions. As long as 1.3400 holds, the structure favors buying dips rather than selling rallies.

DXY (USD) Structure: Rising Channel Between 98.50 And 99.30 With Neutral Momentum

The DXY configuration supports the view that GBP/USD will stay range-bound until NFP breaks the deadlock. The index trades around 98.70–98.80 inside a rising channel from late December, with support near 98.50 and resistance at 99.05–99.30. The 50-period moving average is rising just under spot and acts as dynamic support, while the 200-period moving average remains higher and caps the upside. The RSI around the mid-50s signals neutral momentum: enough to avoid a USD dump, but not enough to force a clean upside breakout. For DXY, a classic tactical setup is buying near 98.50 targeting 99.30, with risk below 98.15; for GBP/USD, this implies that sterling rallies will need a clear DXY break lower to extend beyond 1.3560.

BoE Versus Fed: Slower BoE Cutting Path Supports GBP Against USD

On the monetary policy side, the Bank of England (BoE) is expected to cut rates, but the path is projected to be slower and more gradual than earlier priced, and more conservative than what the market now expects from the Fed. This relative stance has supported GBP over the last couple of months and is a key reason GBP/USD is trading near 1.3450 instead of retesting the lows. The rate differential narrative is simple: a Fed leaning toward faster cuts versus a BoE moving more gradually favors sterling on a relative basis, even in a world where both central banks are in an easing cycle.

Intraday GBP/USD Price Action: Flat Around 1.3465 With Demand At 1.3440–1.3460

Short-term price behavior confirms the consolidation regime. GBP/USD is “flat” around 1.3465 in the early European session, with recent candles showing small bodies clustering above 1.3450. Price action near a rising trendline and repeated buying in the 1.3440–1.3460 pocket point to accumulation, not capitulation. This is classic post-rally consolidation after the move to 1.3565–1.3570, where the market digests prior gains while waiting for the next macro catalyst – in this case, US labor data.

Geopolitics, Risk Sentiment And USD: Venezuela, Oil And Safe-Haven Demand

Risk sentiment and geopolitics are also relevant for USD and therefore for GBP/USD. The US has escalated involvement in Venezuela, seizing crude, capturing President Maduro, and signaling that US energy companies could return to invest billions in the country’s oil sector. That pushed WTI briefly toward $58.32 and Brent near $61.76 before prices eased back. The episode raised global uncertainty, supported safe-haven demand for USD, and helped cap GBP/USD upside. At the same time, the VIX rising around 2% shows investors buying equity protection, which again leans in favor of the dollar in the very short term, even though the medium-term Fed path is dollar-negative.

US Data Flow: Claims, NFP And The Balance Between Growth And Easing

The near-term data sequence will decide whether GBP/USD tests the top or bottom of its range. Initial Jobless Claims are due before NFP, offering a first test of the cooling-labor thesis. Manufacturing data have already softened, but services at 54.4 show resilience. If claims and NFP confirm a slowdown toward 55K–60K jobs and unemployment around 4.5%, the case for earlier and steeper Fed cuts strengthens and should weigh on DXY, opening the door for GBP/USD to push back toward 1.3520–1.3560. Conversely, a strong upside surprise in jobs would delay the easing timeline, potentially send DXY above 99.30, and drag GBP/USD toward or below 1.3400 in the short term.

Cross-Market Signals: EUR/USD And EUR/GBP Reinforce Relative Sterling Strength

Behavior in EUR/USD and EUR/GBP confirms the idea that GBP remains relatively well-positioned. EUR/USD trades around 1.1680, under its 50-day EMA, inside a wider 1.14–1.18 band, with the 200-day MA near 1.1720 capping rebounds. The pair is closer to the top of its range, making pullbacks more likely as markets wait for NFP. EUR/GBP has bounced from its 200-day EMA with targets around 0.8720 before new selling may appear, reflecting expectations that the BoE will cut more slowly than the ECB. This differential favors GBP over EUR, indirectly supporting GBP/USD even when DXY is firm.

Tactical Levels For GBP/USD: 1.3400–1.3440 As Buy Zone, 1.3520–1.3560 As Sell Zone

From a trading perspective, the confluence of macro and technical factors supports a range-trading strategy in GBP/USD with a bias to the upside:
The buy zone sits around 1.3400–1.3440, where horizontal support, trendline demand, and prior reaction lows converge.The resistance / take-profit zone is 1.3520–1.3560, where several recent rallies have stalled and where profit-taking has repeatedly emerged.Intraday traders can structure setups buying dips near 1.3440 with risk just below 1.3390 and targets toward 1.3520–1.3560, while medium-term accounts will focus on whether daily closes remain above 1.3400 and whether DXY fails to break above 99.30 after NFP.

GBP/USD Investment Stance: Bias Bullish, Classified As BUY Within The 1.3400–1.3560 Band

After combining all elements – GBP/USD consolidating around 1.3450–1.3465, DXY capped below 99.30, mixed but softening US labor data, Fed rhetoric leaning toward strong cuts, a BoE expected to ease more slowly, and cross-market signals favoring sterling – the directional bias is still sterling-positive over the medium term. Event risk from NFP can generate volatility, but structurally the pair looks more likely to break higher from the 1.34 area than to enter a new downtrend as long as support at 1.3400 and DXY resistance near 99.30 hold.
Stance on GBP/USD: BUY, with a working range of 1.3400–1.3560 and upside potential beyond 1.3560 if US labor data confirm the Fed’s easing trajectory and risk sentiment stabilizes.

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