The GBPUSD spent the early part of the day trading above and below a key swing area between 1.3365 and 1.33739.
However, as North American traders entered, the bias shifted lower
Sellers leaned against the top of that swing zone, pushed the pair below the 100-hour moving average at 1.33635, and accelerated the downside momentum. The move has since extended to a session low of 1.3325. Helping fuel the decline were stronger-than-expected U.S. initial jobless claims data and a firmer PPI report.
Combined with yesterday’s CPI release, the data have many analysts now projecting a 0.4% increase in core PCE inflation. That is not the type of inflation signal that supports expectations for Fed rate cuts anytime soon and has helped underpin the U.S. dollar. From a technical perspective, the next key downside target comes near 1.33045, where both the May and June swing lows converge.