GBP/USD Price Forecast - GBPUSD Under Pressure at 1.3480 as BoE Dovish Shift Clashes With Dollar Strength

GBP/USD: Dovish BoE, Firm Dollar, Triangle Near Break

BoE Signalling Two–Three Cuts Pulls GBP Profile Lower

GBP/USD is trading roughly 1.3470–1.3488 with the tone controlled by the Bank of England’s pivot toward easing and a USD that refuses to soften. MPC member Alan Taylor openly talked about “two or three” more cuts before Bank Rate reaches a neutral setting, stressing risks shifting toward lower inflation and higher unemployment and expressing confidence that price growth can normalize without further tightening. That language effectively caps the reward for holding GBP, pushes the short-end of the UK curve lower and keeps GBP/USD on the back foot every time the pair tries to lift above 1.3500. With that backdrop, the 20-day EMA at 1.3561 is drifting down and acting as a hard ceiling rather than a launchpad.

UK Data: Higher Jobless Rate, Moderating CPI, No Justification For Hawkish Talk

Recent UK employment and CPI releases align with that dovish rhetoric. The labour market is softening at the margin, joblessness has ticked higher, and inflation has eased back into a more moderate band instead of running hot. That mix gives the BoE space to deliver the “two to three” cuts Taylor floated without jeopardizing credibility on inflation. For GBP/USD, that means bounces are not driven by policy repricing in favour of the Pound; at best, they reflect short-covering or temporary US softness. As long as the macro narrative is “BoE preparing to cut while growth looks only modestly resilient,” the British side of the pair does not justify sustained pricing above the 1.3560 area.

Political Noise And By-Election Volatility Keep Sterling Uncomfortable

On top of monetary policy, politics is injecting extra variance into GBP. The approach of the 26 February by-election has kept implied volatility elevated in UK crosses, with analysts expecting EUR/GBP to drift lower after the event if domestic data stays resilient and political risk eases. Until then, GBP/USD reflects that uncertainty: the Pound is supported enough by sticky inflation and acceptable growth to avoid a collapse, but every political headline dampens enthusiasm for chasing strength. The result is the choppy, whipsaw behaviour around 1.3450–1.3500 that is visible on intraday charts.

Dollar Index DXY Holds 97.80 With 98.00 Trendline Still Capping Upside

On the other side of the equation, the USD is not doing the Pound any favours. The Dollar Index trades near 97.80, supported by a rising trendline from the 95.54 low and the 0.618 Fibonacci retracement at 97.61. That level has repeatedly acted as a floor, confirming a pattern of higher lows. The main roadblock sits at 98.00–98.10, where a descending trendline from the 99.79 high has capped every attempt to break out. The 50-period moving average on the 4-hour chart is turning up around 97.50, while the 200-period average is pressing just under spot at 97.80, signalling a constructive but not explosive setup. Candles congested right below 98.00 show hesitation, yet they also show that dips into the mid-97s are being bought rather than dumped.

Tariff Uncertainty, Section 232 Threats And Fed Path Keep USD Attractive

Macro headlines reinforce that technical structure. New tariff noise is back at the centre: the administration is exploring fresh measures on six US industries under Section 232 after the Supreme Court blocked a chunk of the second-term tariff regime; this sits on top of the 15% global tariff announcement that already rattled global risk assets. The European Union has signalled it could stall its trade deal, and a key meeting with India was postponed while Washington re-maps its tariff strategy. That uncertainty keeps global growth fears alive, which paradoxically helps the USD as a defensive hub. At the same time, Fed Governor Christopher Waller has only conditionally opened the door to a March cut, and market pricing for a 25-basis-point move next month is about 5%, with roughly 50 bps of easing expected for all of 2026. Put differently, the Fed is nowhere near as dovish as the BoE path implied by Taylor’s “two or three cuts” comment, and that relative stance supports the Greenback against the Pound.

GBP/USD 4-Hour Structure: Tight Triangle Between 1.3430 And 1.3535

Technically, GBP/USD is coiling. On the 4-hour chart the pair sits near 1.3488, riding just above support clustered around 1.3430–1.3435. Price is trapped inside a contracting triangle defined by a descending trendline from the 1.3868 high and a rising trendline from the late-January bottom. The 50-period moving average is acting as resistance around 1.3535, while the 200-period average around 1.3550 reinforces that sell zone. Each push into 1.3530–1.3550 has been rejected with relatively small candles, signalling supply shows up quickly at those levels. Unless the pair can close decisively above that moving-average stack, the pattern favours a downside resolution through 1.3430 rather than a clean upside breakout.

Daily Chart: 1.3434 Pivot Guards Path To 1.3360 And 1.3344

The daily view tells the same story but on a slower horizon. Recent price action respects 1.3434—the 19 February low—as the key floor. Above it, GBP/USD drifts sideways to lower with the 20-day EMA sliding down from 1.3561 and capping rebounds. The 14-day RSI sits around the 40 mark, below neutral but not yet oversold, leaving room for another leg lower without forcing an immediate mean-reversion spike. A daily close under 1.3430–1.3434 would confirm that the corrective move is extending and would bring 1.3360 into focus first, then the January low at 1.3344. From a structure standpoint, that would still be a controlled pullback rather than a meltdown, but it would lock in a more clearly bearish short-term picture.

Intraday Momentum: RSI Roll-Over And EMA50 Resistance Point To Renewed Selling

Short-term momentum indicators underline that downside bias. Economies’ intraday read notes that GBP/USD has retreated after pushing into overbought territory on relative-strength metrics, with fresh negative signals emerging as the pair slid back under the EMA50. Price continues to follow a supportive trendline lower inside a bearish corrective channel, with each attempt to push higher quickly sold into. That is classic behaviour of a managed downtrend: momentum briefly overheats on the upside, oscillators cool from overbought, then price resumes lower once sellers re-establish control. The fact that this is happening below a declining 20-day EMA adds weight to the bearish interpretation.

EUR/USD Triangle Confirms Dollar-Driven Theme, Not Pound-Specific Weakness

Context from EUR/USD reinforces that this is primarily a USD story. The euro pair trades near 1.1778 on the 4-hour chart, sitting just above support at 1.1742 and boxed inside its own triangle between a descending line from the 1.2050 high and an ascending line from mid-January lows. The 50-period moving average around 1.1810 is acting as a lid, mirroring how the 50-period average caps GBP/USD around 1.3535. If EUR/USD breaks 1.1740, 1.1680 becomes the next obvious destination, similar to how a break of 1.3430 in GBP/USD would open 1.3360 and 1.3344. That parallel behaviour confirms the Dollar is imposing itself against European currencies broadly, not just against Sterling.

Tariff Shock, Supreme Court Ruling And Safe-Haven Flows Feed USD Resilience

The macro overlay is clear. Fresh tariff threats, the Supreme Court’s decision to strike down parts of the previous tariff framework, and renewed talk of 15% blanket duties plus new Section 232 measures all weigh on global risk sentiment. The EU hinting at delaying its trade deal and India postponing negotiations add to the unease. At the same time, safe-haven flows are going into the USD and gold, not into GBP. Gold has been trading above the $5,000 handle, confirming that risk aversion is real, yet the Dollar Index stays elevated rather than crumbling. That tells you the market still prefers the Greenback as the core hedge against policy missteps and geopolitical stress.

Key Levels And Risk Skew: Sell Rallies Below 1.3550, Watch 1.3430 Break For Extension

Putting everything together, GBP/USD currently trades with a negative skew while it remains below the 1.3530–1.3561 band defined by the 4-hour moving averages and the 20-day EMA. The technical cluster between 1.3430 and 1.3434 is the key near-term trigger: a clean close below that zone opens 1.3360 and then 1.3344. As long as the pair respects that downside bias and the daily RSI stays near 40 without reclaiming 50, the strategy favours selling strength into 1.3530–1.3560 rather than chasing short squeezes. Only a sustained move back above 1.3550–1.3561 would justify reassessing the short-term stance and looking toward 1.3700 and, later, the 1.3868 high. With BoE figures openly discussing two to three cuts, UK data tolerating easing, tariff noise supporting the Dollar and DXY pressing 98.00 from above a solid 97.61 base, the balance of evidence points to GBP/USD as bearish for now, with a Sell bias on rallies and downside targets at 1.3430, 1.3360 and 1.3344 unless the pair can retake and hold above the mid-1.35s.

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