GBPUSD – The bearish outlook faces increasing resistance at the 2026 low

Cable remains under pressure near its 2026 low at 1.3159 (posted on March 31), with last Friday’s low and trendline support converging at 1.3163, following news of UK Prime Minister Starmer’s resignation.

The pound continues to face headwinds amid growing uncertainty over the policy direction of the incoming Prime Minister, who is expected to take office in early September. Concerns center on managing an economy constrained by persistently weak growth, elevated public debt, and the highest borrowing costs among G7 economies, while also addressing competing demands for fiscal restraint and increased investment, particularly in defense.

These uncertainties, combined with broad-based dollar strength supported by the Federal Reserve’s hawkish stance, continue to weigh on sterling.

Bearish daily indicators reinforce the negative near-term outlook. However, oversold conditions suggest that price action may stabilize above the key support zone at 1.3163/59 before the broader downtrend resumes.

On the upside, strong resistance is seen around 1.3300, the former range floor, followed by 1.3335, where the descending 10-day moving average is located. A sustained break above these levels would ease immediate bearish pressure and expose the next significant barriers at 1.3408, marked by the daily cloud base and the 200-day moving average.

Res: 1.3278; 1.3300; 1.3335; 1.3377
Sup: 1.3159; 1.3080; 1.3009; 1.2984