A series of high-impact events this week—including UK inflation data, US retail sales, and interest rate decisions from Canada and the ECB—could trigger sharp market moves. Against this backdrop, GBPUSD remains in a steady uptrend, supported by a series of higher peaks and troughs since January.
On the macro front, stronger-than-expected UK GDP growth in February offered a touch of optimism, but concerns linger due to rising domestic costs and new US tariffs. With global economic uncertainty still in play, upcoming data could be pivotal in shaping GBPUSD’s near-term direction.
The GBPUSD pair has sustained a well-defined uptrend since establishing a low at 1.20987 on January 13. This upward trajectory has been marked by a consistent pattern of higher peaks and higher troughs, indicative of persistent bullish momentum.
The initial technical reversal was signaled by a failure swing, where the trough at 1.21605 undercut the previous low, followed by a decisive break above the prior peak at 1.23053. This confirmed the shift in market structure and set the stage for continued price appreciation.
Subsequent bullish confirmation came from a “Golden Cross” formation, as the 20-period Exponential Moving Average (EMA) crossed above the 50-period EMA. This double crossover reinforced the bullish sentiment, reflecting strengthening buying interest.
Momentum indicators are supportive of the prevailing trend. The Momentum Oscillator remains firmly above the 100 level, signaling sustained upside bias, while the Relative Strength Index (RSI) continues to register values above the 50 threshold, further affirming positive momentum.
However, emerging signs of negative divergence between price action and the Momentum Oscillator merit close monitoring. While the broader trend remains intact, this divergence suggests the potential for a near-term corrective pullback.
Key Resistance Levels
Should the buyers maintain market control, traders may direct their attention toward the four potential resistance levels below:
1.34146: The initial resistance level is set at 1.34146, reflecting the weekly resistance, R2, estimated using the standard Pivot Points methodology.
1.35148: The second price target is set at 1.35148, representing the 161.8% Fibonacci Extension drawn from 1.32064 to 1.27073.
1.36850: The third price objective is observed at 1.36850, corresponding to the weekly resistance, R3, calculated using the standard Pivot Points methodology.
1.40139: An additional upside target is projected at 1.40139, mirroring the 423.6% Fibonacci Extension drawn from 1.32064 to 1.27073.
Key Support Levels
Should the sellers take market control, traders may consider the four potential support levels listed below:
1.32064: The initial support level is estimated at 1.32064, representing the peak marked April 3.
1.29777: The second level is seen at 1.29777, corresponding to the weekly Pivot Point, PP, estimated using the standard methodology.
1.28112: The third support level is identified at 1.28112, reflecting the weekly support, S1, calculated using the standard Pivot Points methodology.
1.27073: An additional downside target is 1.27073, mirroring the trough from April 7.
Fundamentals
The UK economy grew by 0.5% in February—well above the expected 0.1%—driven by stronger trade, manufacturing, services, and construction activity. The data, released by the Office for National Statistics, follows a stagnant January and signals a potential rebound in economic momentum. Revised figures for January now show zero growth instead of a decline, further supporting the positive trend.
Chancellor Rachel Reeves welcomed the figures as encouraging but warned of global uncertainty, especially as US President Trump’s new 10% tariffs on UK goods threaten future trade. Rising domestic costs, corporate taxes, and energy bills also pose risks to sustained recovery.
While February’s data offers hope, analysts and political leaders remain cautious, noting that global tensions and economic pressures could dampen future growth.
Published this morning, UK inflation eased in March 2025, with CPIH falling to 3.4% and CPI to 2.6% year-on-year, reflecting a slowdown in housing and consumer cost increases.
Conclusion
GBPUSD remains in a strong uptrend, backed by favorable technical signals and a surprisingly upbeat UK growth reading. However, the broader landscape remains fragile. With key economic data and central bank decisions still ahead, traders should stay alert to potential shifts in sentiment—especially amid ongoing global trade tensions and inflationary pressures. Whether the pair extends its rally or encounters resistance, this week’s developments could prove pivotal in shaping the near-term outlook.
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