1.3400 resistance under test: GBP/USD Price Forecast as bullish pressure builds

1.3400 resistance is under test as GBP/USD advances for a second consecutive day.
Pressure on the BoE to raise interest rates in November intensified following the UK CPI release.
A move above 1.3400 would put former support near 1.3480 in focus as the next upside target.

1.3400 is the resistance area now facing GBP/USD bulls. The British Pound (GBP) has rallied nearly 2% against the US Dollar (USD) from last week’s lows and is extending its advance on Wednesday. Earlier hesitation in the European session reflected a rise in public borrowing that offset the support from stronger-than-expected consumer inflation.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

Higher energy prices pushed UK inflation above expectations in September, according to Consumer Price Index (CPI) data published earlier in the day. The release reinforced expectations of an eventual interest rate increase by the Bank of England at its 4 November meeting.

Despite the inflation news, the Pound initially struggled to advance. Public Sector Net Borrowing data published simultaneously showed that UK government debt rose in September at its fastest pace in more than five years, largely because of debt interest. With Chancellor John Healey preparing the budget for release next week, the figures may have revived longstanding concerns over the UK’s public finances.

Technical Analysis: 1.3480 in focus beyond 1.3400

At 1.3389, GBP/USD retains a positive bias following confirmation earlier this week of a break above the horizontal range of the previous two weeks. On the 4-hour chart, the Relative Strength Index (14) stands at 69.14, just short of overbought territory. The Moving Average Convergence Divergence (MACD) histogram is still slightly positive. Together, these indicators point to firm upward momentum, though the near-term move is becoming increasingly stretched.

Should 1.3400 give way, buyers would target the 13 August and 3 September lows around 1.3470. That area also marks the 61.8% Fibonacci retracement of the August-October decline. Beyond it, the next level would be the 9 September high near 1.3670.

The 1.3300 area offers initial support, aligning with Monday’s and Tuesday’s lows and the upper boundary of the previous two weeks’ channel. A decisive move below it would restore bearish control, bringing the year-to-date lows around 1.3140 back into view.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Pound Sterling Weekly Performance

The British Pound (GBP) recorded its strongest performance against the US Dollar this week. Its percentage changes against the major currencies listed are shown in the table below.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.42%	-0.67%	-0.06%	-0.51%	-1.09%	-0.62%	-0.23%
EUR	0.42%		-0.21%	0.37%	-0.05%	-0.58%	-0.17%	0.22%
GBP	0.67%	0.21%		0.59%	0.17%	-0.35%	0.05%	0.50%
JPY	0.06%	-0.37%	-0.59%		-0.43%	-1.01%	-0.55%	-0.04%
CAD	0.51%	0.05%	-0.17%	0.43%		-0.58%	-0.07%	0.33%
AUD	1.09%	0.58%	0.35%	1.01%	0.58%		0.40%	0.82%
NZD	0.62%	0.17%	-0.05%	0.55%	0.07%	-0.40%		0.44%
CHF	0.23%	-0.22%	-0.50%	0.04%	-0.33%	-0.82%	-0.44%

This heat map compares percentage movements between major currencies. Select the base currency in the left-hand column and the quote currency in the top row. To find the change in GBP (base)/USD (quote), for instance, choose the British Pound on the left and follow its row across to the US Dollar column. The intersecting cell gives the pair’s percentage change.