GBP/USD Forecast: Will 1.36 or 1.34 Break First? 3 Catalysts to Watch Now

The pound has bounced back against the dollar, trading at 1.3506 after reclaiming the 50-day SMA (1.3446) and 200-day SMA (1.3464).

Written by: Arslan Butt • Sunday, September 7, 2025 • 1 min read

• Last updated: Sunday, September 7, 2025

Quick overview

The pound has rebounded against the dollar, currently trading at 1.3506 after surpassing key moving averages.
Technical indicators show caution, with a potential bearish divergence forming as momentum weakens.
Upcoming US economic data this week could significantly influence GBP/USD, with inflation reports being particularly crucial.
The market is at a critical juncture, with key levels to watch for potential bullish or bearish setups.

The pound has bounced back against the dollar, trading at 1.3506 after reclaiming the 50-day SMA (1.3446) and 200-day SMA (1.3464). The chart is in an uptrend, with higher lows and higher highs. But the latest candle has a long upper wick at 1.3550, which suggests sellers are stepping in at higher levels.

Momentum is starting to crack. RSI is at 64.9 and getting close to overbought, and if price goes higher while RSI flattens, a bearish divergence could form and we could see a pullback. Candlestick signals are also cautionary, with the upper wick looking like a shooting star, a common reversal pattern.

Macro Events This Week

This week is packed with US data that will set the tone for GBP/USD:

Sept 10 – US PPI: 0.3% m/m expected
Sept 11 – ECB meeting: Rates expected to stay at 2%, but Lagarde’s comments could impact euro crosses and spill over to GBP
Sept 11 – US CPI: 0.3% m/m and 2.9% y/y expected, a key release for the Fed’s next move
Sept 12 – Jobless claims: 237k expected
Sept 12 – Michigan sentiment: High 50s expected

If inflation cools, the Fed could ease and GBP/USD could rally. If US data is strong, the dollar could gain and pressure the pound.

GBP/USD Technical Outlook and Trade Setup

GBP/USD is at a crossroads. A daily close above 1.3520 would confirm the bounce, 1.3550 and 1.3588 next. Failure to hold gains could see 1.3478 and then 1.3417.

GBP/USD Price Chart - Source: Tradingview — GBP/USD Price Chart – Source: Tradingview

Bullish: Long above 1.3520 to 1.3550-1.3588, stop 1.3470
Bearish: Short below 1.3478 on a bearish engulfing or three black crows to 1.3417

The market is on a knife edge. This week’s US inflation data will be the trigger.

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ABOUT THE AUTHOR See More

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.