GBP/USD Price Forecast: Trades below 1.3500 on firmer USD, ahead of UK GDP

The GBP/USD currency pair has been trading below the 1.3500 level during the Asian session on Thursday, following a week of mild bullish momentum. The current downward trend is primarily driven by the strengthening US Dollar (USD), as traders appear to be waiting for key UK macroeconomic data, specifically the Q2 GDP report, before committing to any bullish positions.

Inflation concerns stemming from fluctuating oil prices continue to support the USD, while geopolitical tensions between the United States and Iran add to the underlying pressure on the GBP/USD pair.

From a technical standpoint, the GBP/USD pair has been oscillating within a one-week-old range, indicating a potential bullish consolidation phase. However, the relative strength of this phase is undermined by mixed momentum indicators, with the Relative Strength Index (RSI) near the neutral 50 mark and the Moving Average Convergence Divergence (MACD) slipping below zero.

This suggests that the market may continue to consolidate rather than exhibit clear directional conviction, making it a risky proposition for aggressive traders.

If the pair breaks below the current support level near 1.3491, there is a risk of further downside, potentially dragging prices to the 100-period Simple Moving Average (SMA) around 1.3415. Conversely, a successful defense of these supports would likely maintain the bullish bias for the pair. Investors should remain cautious and await further clarification from upcoming economic indicators, particularly the Q2 UK GDP release, scheduled for Thursday.