GBP/USD Price Forecast: Fails near 1.3500 as bears eye 200-SMA ahead of Fed decision

The GBP/USD currency pair experienced a decline near the 1.3500 mark as sellers entered the market shortly after a brief uptick, and subsequently traded at the lower end of its daily range during the initial half of Europe's trading day on Wednesday. The current price sits around 1.3470-1.3465, just above a one-month low observed on Tuesday, as market participants eagerly await the results of the Federal Open Market Committee (FOMC) meeting.

Traders expect the US Federal Reserve (Fed) to maintain its hawkish stance due to concerns over oil-induced inflation and elevated US bond yields, which support the US Dollar (USD). Additionally, heightened tensions in the Middle East contribute to the appeal of the US Dollar as a safe-haven currency, further limiting the potential upside for GBP/USD.

The pair currently trades near the 38.2% Fibonacci retracement level, above the 200-day Simple Moving Average (SMA) at 1.3455 and the 50.0% retracement at 1.3406. Should the 50.0% retracement prove to be a decisive barrier and break downwards, it could signal a fresh opportunity for GBP/USD bears. Meanwhile, technical indicators suggest that a shallow consolidation might take place rather than a sustained upward movement in the near term.

Failure to surpass the 200-day SMA at 1.3455 could pave the way for more substantial declines towards the 50.0% retracement level at 1.3406 and the 61.8% level at 1.3343. Conversely, a break above the 23.6% Fibonacci retracement near 1.3548 would indicate a potential upside turnaround, with the recent swing high at 1.3675 constituting a stronger resistance level.