In October, the composite PMI reached 52.2 points versus the forecast of 51.1 and the previous 50.1, while the services index rose to 52.3 from 50.8, reflecting an economic rebound and the effectiveness of the authorities’ policies. In November, the Bank of England kept the interest rate at 4.00%, as expected, with five of nine members voting to maintain it and four supporting a cut — showing a gradual shift toward a dovish stance. Governor Andrew Bailey’s optimistic remarks about the economy and inflation during the press conference also supported the pound, noting that the risk of persistently high inflation has decreased and maintaining demand has become a higher priority.
On the downside, average earnings including bonuses slowed from 5.0% to 4.8% in September (expected 5.0%), while employment fell from +91K to –22K, and unemployment rose from 4.8% to 5.0%. Policymakers remain concerned that wage growth could keep inflation above the 2.0% target, potentially pushing GBP/USD lower toward 1.3020 in the long term.
Support and Resistance Levels
The long-term trend turned bearish in late October, with price reaching 1.3020 before bouncing to resistance at 1.3170. A breakout above this level could extend the correction toward 1.3320 and 1.3500, while failure to sustain gains would likely trigger a retest of last week’s low and a drop below 1.3020.
In the medium term, the pair remains bearish: price has broken below the key support area at 1.3406–1.3374 and tested target zone 2 (1.3086–1.3054). The ongoing correction may push the pair toward 1.3362–1.3330, where short positions targeting 1.3185 and 1.3010 could become relevant.
Resistance levels: 1.3170, 1.3320, 1.3500.
Support levels: 1.3020, 1.2760, 1.2715.
Trading Scenarios and GBP/USD Forecast
Short positions can be opened from 1.3170 with a target at 1.3020 and stop loss at 1.3215. Duration: 9–12 days.
Long positions may be opened above 1.3215 with a target at 1.3320 and stop loss at 1.3170.