It falls below 1.3100 as rates of a big Fed rate cut decline

• GBP/USD’s downtrend is intensifying, with momentum signaling further downside as the RSI nears a break below neutral.
• Key support at 1.3044 could trigger deeper losses, with the 50-DMA at 1.2933 and the 1.2900 mark as critical levels.
• Buyers need to recover 1.3239 for a bullish continuation and regain upside momentum.

GBP/USD starts the North American session down more than 0.30% on Monday as traders play down the odds of a 50 basis point Fed rate cut in ten days. At the time of writing, the pair is trading at 1.3075 after hitting a high of 1.3143.

GBP/USD Price: Technical Insights

GBP/USD fell below the 1.3100 level, although the uptrend remains intact unless sellers take the pair below the July 17 high of 1.3044, which could open the door for a deeper pullback.

The timing suggests another downside. The Relative Strength Index (RSI) is about to break below its neutral line, which could trigger a sell. Therefore, in the short term, the path of least resistance is downward sloping.

The first support for GBP/USD would be the July 17 peak followed by the 1.3000 figure. Further losses are seen below this level, with the 50-day moving average (DMA) emerging as a potential line of defense for buyers at 1.2933 ahead of 1.2900.

For a bullish continuation, GBP/USD buyers need to recover last week’s peak at 1.3239.

GBP/USD Price Action – Daily Chart