GBP/USD Recovers Toward 1.3300 as Traders Take Profit Ahead of U.S. Data

In the U.S., market activity remains subdued due to the ongoing government shutdown. The Senate has rejected the temporary funding bill for the seventh time, securing only 47 votes out of the required 60. Analysts note that each week of the shutdown costs the U.S. economy between 0.1% and 0.2% of GDP growth. Meanwhile, the dollar maintains a bullish tone as labor market data is not being published. Investors are nearly certain that the Federal Reserve will cut rates by another 25 basis points in October, with a similar move likely in December.

In contrast, the Bank of England remains cautious. Persistently high inflation prevents the regulator from easing monetary policy. Monetary Policy Committee member Catherine Mann recently commented that inflation expectations in the U.K. remain “too high,” and restrictive policy must be maintained longer to return inflation to the 2.0% target. The government is also expected to introduce unpopular fiscal tightening measures, including spending cuts and potential tax hikes, which could further raise political tension.

Later today, at 16:00 (GMT+2), the U.S. will release the University of Michigan Consumer Sentiment Index for October, forecasted to decline from 55.1 to 54.2. The data is unlikely to exert significant pressure on the U.S. dollar.

Support and Resistance Levels

Bollinger Bands on the daily chart are trending lower, widening as volatility increases. The MACD continues to decline, keeping a strong sell signal, while the Stochastic indicator nears oversold territory — hinting at potential short-term exhaustion of bearish momentum.

Resistance levels: 1.3364, 1.3413, 1.3450, 1.3500.
Support levels: 1.3300, 1.3250, 1.3200, 1.3150.

Trading Scenarios and GBP/USD Forecast

Short positions can be opened after a confident break below 1.3250, targeting 1.3150 with a stop loss at 1.3300. Estimated duration: 2–3 days.

Long positions may be considered after a breakout above 1.3364, targeting 1.3500 with a stop loss at 1.3300.