Bearish Structure Poised to Persist Absent a Decisive Bullish Breakout

Forex

Economic

Summary:

The horizontal resistance at 1.3460 has effectively functioned as a "supply wall," thwarting bullish attempts to reclaim higher ground.

SELL GBPUSD

EXP

TRADING

1.33847

Entry Price

1.33140

1.35100

1.33442 +0.00015 +0.01%

0.0

Pips

Flat

1.33140

Exit Price

1.33847

Entry Price

1.35100

Geopolitical tensions surrounding the ongoing conflict between the United States and Iran remain the primary focus for global participants. As the war enters its twelfth day with no discernible signs of de-escalation, market sentiment remains fraught with uncertainty. The military landscape continues to intensify, with the U.S. and Israel conducting strategic strikes against Iranian installations, while Tehran retaliates via missile and drone incursions targeting American and Israeli assets across the broader region.

On the economic front, the latest Consumer Price Index (CPI) data for February aligned perfectly with expectations, mirroring the January print at 2.4% year-over-year. Simultaneously, core figures—which exclude the volatile components of food and energy—advanced by 2.5%, precisely meeting consensus estimates. On a month-over-month basis, core inflation edged higher by 0.2%, representing a slight deceleration from the 0.3% increase recorded in January, while the annual rate held steadfast at 2.5%.

These data points have reinforced the market’s view that the Federal Reserve will maintain a highly cautious policy trajectory, as inflation continues to trend stubbornly above the central bank's 2% target. Investors are now pivoting their focus toward the upcoming Personal Consumption Expenditures (PCE) report scheduled for Friday, a release that is expected to critically shape monetary policy expectations for the coming months.

The recent Non-Farm Payrolls (NFP) report further complicated the macro narrative, revealing a startling contraction of 92,000 positions. This result starkly contradicted consensus forecasts that had anticipated a gain of 59,000 jobs. Consequently, the unemployment rate trended higher to 4.4%, though it remains marginally below the 4.5% threshold projected by the Fed for 2026. Despite this visible cooling in the labor force, consumer resilience remains remarkably robust; the Census Bureau reported that Retail Sales hit $733.5 billion in January, defying the projected 0.3% decline with a significant 3.2% year-over-year expansion.

In the United Kingdom, Chancellor Rachel Reeves indicated that it remains premature to implement direct intervention measures to shield households from the spike in energy costs precipitated by the Middle East conflict. While the domestic economic calendar remained relatively quiet, traders are closely weighing a forecast from Oxford Economics, which suggests that a two-month closure of the Strait of Hormuz could drive UK inflation higher by approximately 0.4%.

Looking ahead, the UK economic calendar features a high-impact speech from Bank of England (BoE) Governor Andrew Bailey. Meanwhile, in the United States, participants will be monitoring Initial Jobless Claims, the Trade Balance, and fresh data from the housing sector to gauge the relative health of the domestic economy. Bearish Structure Poised to Persist Absent a Decisive Bullish Breakout_1

Bearish Structure Poised to Persist Absent a Decisive Bullish Breakout_1

Technical Analysis

From a technical perspective, GBP/USD remains entrenched in a definitive bearish trend. The pair recently encountered a cluster of technical resistance after testing the 100-period Moving Average situated at 1.3504. This level is of high structural significance, as it converges precisely with the primary descending trendline. Furthermore, the horizontal resistance at 1.3460 has effectively functioned as a "supply wall," thwarting bullish attempts to reclaim higher ground.

This confluence of indicators suggests that a renewed downward impulse is the most probable scenario, with primary bearish objectives targeted at the local support floor of 1.3314.

Our analysis of momentum oscillators reinforces this bearish bias. The RSI recently peaked at 60.96, failing to sustain its position above the neutral threshold before descending rapidly toward the 47 level. This move back into negative territory suggests that the corrective phase may have concluded. Simultaneously, the MACD has signaled a bearish histogram crossover. While the signal lines are currently hovering just above the neutral baseline, a transition into the negative zone—coupled with increasing histogram depth—would provide the necessary technical validation for an extended move to the downside.

Trading Recommendations

Trading direction: Sell

Entry price: 1.3386

Target price: 1.3314

Stop loss: 1.3510

Validity: Mar 20, 2026 15:00:00

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Bearish Structure Poised to Persist Absent a Decisive Bullish Breakout

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