GBP – A large double top has formed, and the pound is struggling above the neckline

The pound has held above 1.32 against the dollar this week, but remains trapped within that range. Technical charts show a small double bottom in the RSI and Stochastic Oscillator, with a slight rebound, suggesting the pound may continue its short-term stabilization, though upward momentum will likely be limited. Resistance is seen at 1.3280, with the next key level at the 250-day moving average of 1.3410. A break below this level in mid-month turned into upward resistance for the following three trading days, failing to recover. Stronger resistance is seen at the 50-day moving average around 1.3460 and even 1.3530. Below, the 1.32 level remains a key point to watch. A break below this level would be a warning sign of a new wave of decline. Furthermore, a break below the June low of 1.3139 could potentially trigger a large double-top pattern, a double-top formation that has taken nearly six months to form, with each top taking approximately three months to form, and their respective highs and lows being quite close. Therefore, when the pound falls into the 1.31 range, it will be a crucial moment! The next key level to watch is 1.30, which was successfully held last November before the pound surged. The next target is 1.28.

Forecasted range:
Resistance 1.3280 - 1.3410 - 1.3460* - 1.3530
Support 1.3200* – 1.3130*** - 1.3000 – 1.2800

This Week's News Highlights:
29/9
UK August Mortgage Approvals: 54,918
UK August Net Personal Lending: £6.9 billion
UK August Consumer Credit: £2.464 billion
UK August M4 Money Supply YoY: +4.4%
UK August M4 Money Supply MoM: +0.4%

Focus:

Wednesday
UK Q2 GDP (14:00)

Thursday
UK September Manufacturing PMI (16:30)

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