1.33 Taken Out, GBPUSD Eyeing New Cycle Highs

Summary:

FX desks are squarely in wait-and-see mode ahead of Friday's marquee U.S. inflation print. The September PCE deflator, the Fed's preferred gauge, is set to calibrate rate-expectation path and could be the catalyst for the next leg higher in cable.

SELL GBPUSD

Close Time

CLOSED

1.33477

Entry Price

1.29000

1.35000

1.34060 +0.00029 +0.02%

15.4

Pips

Profit

1.29000

1.33323

Exit Price

1.33477

Entry Price

1.35000

Fundamentals

GBPUSD stormed to a five-week peak Thursday, delivering its largest one-day advance since April 2025. The move was fuelled by (i) an upward revision to high-frequency business-activity gauges, (ii) the dissipation of Budget-related tail-risk, and (iii) heightened market pricing that the FOMC will imminently embark on an easing cycle.

The Bloomberg Dollar Spot Index has declined for ten consecutive sessions. Should the skid extend it would mark the longest losing streak since the post-Bretton Woods float in 1971, further lubricating the upside in GBPUSD.

The proximate trigger was the final November S&P Global UK Composite PMI, which was revised materially higher from its flash estimate and spans both the services and manufacturing sectors, portraying a discernibly firmer growth trajectory. "The UK's economic backdrop is not as anaemic as initially feared," Danske Bank strategist Kirstine Kundby-Nielsen observed.

According to the final release from S&P Global on 3 December 2025, the UK Composite PMI for November was revised up by 0.7% to 51.2 from the 21 November flash estimate of 50.5. Although this remains below both the October final reading of 52.2 and the initial market consensus of 51.8, the index has now spent seven consecutive months above the 50.0 no-change mark, confirming that UK private-sector output continues to expand. The pace of growth, however, has eased compared with the previous month, pointing to a "modest expansion, solid resilience" regime.

At the sector level, the Services PMI was revised 0.8% higher to 51.3, beating the flash 50.5 and the market call of 51.0. The Manufacturing PMI was left unrevised at 50.2, still well ahead of the 49.3 consensus. The synchronized outperformance of the two core segments provided the main underpinning for the upward revision of the headline composite gauge.

Markets are increasingly pricing in a Fed rate cut next week, a move widely seen as pressuring the USD and lifting major pairs such as GBPUSD. According to CME's FedWatch tool, futures-implied odds for a 25 bp reduction at the December FOMC, taking the target range to 3.50%-3.75%, have surged to almost 87%, up from 63% a month ago.

The latest DOL release (week ending 29 Nov.) showed initial jobless claims fell 27,000 to 191 k after seasonal adjustment—the lowest print since Sep-2022 and well below the Reuters-consensus forecast of 220,000. Although the survey window included the Thanksgiving holiday, when filings can be volatile, the sub-200,000 reading is historically low and aligns with still-muted layoff announcements, easing fears of an abrupt labour-market unwind.

The upbeat print contrasts with Wednesday's ADP report, which revealed the sharpest drop in private payrolls in 2½ years. Continuing claims (week ended 22 Nov.) edged down to 1.939 million but remain elevated, consistent with the unemployment rate's climb from 4.3% in August to 4.4% in September.

Economists note that the labor market is currently in a "no-layoffs, no-hiring" stalemate. Key drivers include (i) a contraction in labor supply amid tighter immigration policy and (ii) downward pressure on demand for entry-level positions as AI adoption displaces routine tasks. Uncertainty stemming from the Trump administration's trade agenda is further damping hiring sentiment, particularly among small firms.

Technical Analysis

On the 4-hour chart, GBPUSD is grinding higher along EMA12, the MACD "angel-kiss" re-cross keeps bulls in charge, Bollinger bands angle up with price tipped to tag the upper band around 1.339. RSI 69, still constructive.

On the daily chart, after clearing the EMA200 and punching the upper Bollinger, the pair eyes the 1.35 platform high. MACD bullish crossover and move back above zero affirm follow-through, yet RSI 64 warns momentum may fade on the test.

Therefore, the advised trading strategy is to long-first/short-second into 1.35 resistance.

1.33 Taken Out, GBPUSD Eyeing New Cycle Highs_1

1.33 Taken Out, GBPUSD Eyeing New Cycle Highs_2

Trade Recommendations

Trade Direction: Sell

Entry Price: 1.336

Target Price: 1.29

Stop Loss: 1.35

Support: 1.3/1.29/1.28

Resistance Levels: 1.34/1.342/1.35

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

Risk Disclosure

The risk of loss in trading financial instruments such as stocks, FX, commodities, futures, bonds, ETFs and crypto can be substantial. You may sustain a total loss of the funds that you deposit with your broker. Therefore, you should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources.

No decision to invest should be made without thoroughly conducting due diligence by yourself or consulting with your financial advisors. Our web content might not suit you since we don't know your financial conditions and investment needs. Our financial information might have latency or contain inaccuracy, so you should be fully responsible for any of your trading and investment decisions. The company will not be responsible for your capital loss.

Without getting permission from the website, you are not allowed to copy the website's graphics, texts, or trademarks. Intellectual property rights in the content or data incorporated into this website belong to its providers and exchange merchants.

Recent Searches

Top Searches

Markets

Analysis

User

24/7

Economic Calendar

Education

Data