GBPUSD – modest advance after BoE holds interest rates steady

The pound jumped above the 1.31 level after the Bank of England left interest rates unchanged, as widely expected, but later trimmed gains following signals that policymakers may consider a rate cut at the December meeting. This potential move would come after the release of the government’s budget on November 26 and key inflation data for October and November, offering more insight into the economic outlook.

The rebound from multi-month lows around 1.3009, where a double-bottom formed as broader bears faced solid resistance near the psychological 1.30 level, extended for a second consecutive session. However, the rally stalled near the initial resistance at 1.3118 (Fibo 23.6% of the 1.3471–1.3009 drop), leaving more significant barriers at 1.3170 and 1.3186 still intact.

This limited advance raises concerns about a shallow correction before bearish momentum resumes for another test of the 1.30 pivot zone. The daily technical setup remains negative, with the recent 10/200DMA death cross and an approaching 20/200DMA cross reinforcing the downside bias. Although momentum has turned slightly higher, it remains deep in negative territory, while RSI emerging from oversold levels provides only partial relief to the bearish tone.

Any extended upticks are expected to remain capped below the 1.3186 resistance, marking a corrective phase within the broader downtrend. On the other hand, a stronger push above 1.3240/1.3260 (50% retracement / 200DMA) would challenge the bearish structure and signal potential for a more meaningful recovery.

Res: 1.3143; 1.3186;1.3218; 1.3240
Sup: 1.3042; 1.3000; 1.2948; 1.2810