Today, the GBP to USD rate continued to decline, as the GBP showed sluggish performance against all major currencies, with GBP/USD falling to $1.2300, reflecting a 0.40% decrease. The pair is facing challenges in gaining momentum amidst various domestic and international economic pressures, despite the Bank of England not being as dovish as the ECB.

GBP/USD Chart H1 – Selling at the 20 SMA

The trouble for GBP/USD started earlier this month when the USD started to regain momentum, leading to a sharp decline below the 1.2500 level in GBP/USD. Despite a brief consolidation period below this level, sellers came back the selling momentum resumed last Friday sending it below 1.24 where it closed last week. Today the selling momentum continued, resulting in a 0.4% decline to 1.2300, exactly to the pip.

From a technical perspective, there are few factors to halt the decline for GBP/USD at this point. The next significant support level is around the October low of 1.2000-1.2050, which is still approximately 300 pips away, so there’s a lot of flash for GBP sellers to chew.

Therefore, this will likely continue unless there is a notable shift in sentiment towards the Buck which doesn’t seem likely, with the FED postponing interest rate cuts, probably in September. So, it will be challenging to argue against further downside for this forex pair. If sterling fails to stabilize even in the face of a more positive risk sentiment today, it doesn’t bode well for its short-term prospects, especially considering the current chart pattern.

GBP/USD Live Chart