GBP/USD extends decline following weak UK economic data; potential consolidation may precede another leg lower

GBP/USD extended its decline on Friday, remaining in the red for the third consecutive session as a stronger dollar and unexpectedly weak UK October GDP figures weighed on the pair.

The fresh weakness tested support at 1.2618 (last week’s low and 100-week moving average) and brought bears closer to the key Fibonacci level at 1.2610 (61.8% retracement of the 1.2487/1.2811 upswing), where selling momentum started to face resistance.

Short-term action may see consolidation before a renewed push to challenge the 1.2618/10 pivot area. A break below this zone would pave the way for further declines targeting 1.2563/40 (76.4% Fibonacci retracement and lower 20-day Bollinger band), with critical supports at 1.2500/1.2487 (psychological level and November 22 low) coming into focus.

Initial resistance is seen at 1.2673 (20-day moving average), followed by 1.2700/11 (psychological level and falling 10-day moving average), which are expected to limit rebounds and keep near-term bearish momentum intact.

Daily technical indicators point to further downside, with moving averages aligned in a bearish configuration and the 14-day momentum indicator nearing the centerline. The weekly chart adds to the bearish outlook, showing a reversal pattern forming alongside an imminent death cross between the 10-week and 200-week moving averages.

Res: 1.2673; 1.2711; 1.2735; 1.2750
Sup: 1.2619; 1.2563; 1.2500; 1.2487