GBP/USD remains stable around the 1.2923 level, struggling to progress after a bull run stalled near its upper channel. The pair peaked at 1.2945 last week, the highest since November 2024, but suggests a potential slowdown as overbought signals emerge.
Despite minor losses on Monday, GBP/USD gained traction on Tuesday, trading above 1.2900. The near-term outlook indicates a sustained bullish bias, yet the pair may encounter strong resistance at 1.2975.
Safe Haven Influence
Safe-haven flows have influenced market actions, particularly following declining Wall Street indexes due to concerns over an economic downturn in the US.
The current stability of the pair near 1.2923 suggests that the earlier momentum is fading. After reaching its peak of 1.2945, trading behaviour indicates that upward movement is slowing, particularly as technical markers suggest overbought conditions. These signals imply that many traders are hesitant to push the price higher without further confirmation.
Tuesday’s gains reinforce the broader trend, as holding above 1.2900 keeps sentiment leaning towards further upside—at least for now. However, the level at 1.2975 presents an area where sellers may step in, particularly those who are looking to take advantage of stretched conditions. If resistance proves too strong, we could see some profit-taking emerge in response.
Market Sentiment Shifts
Market moves have also been shaped by shifts in sentiment regarding economic health. The recent downturn in Wall Street indices has increased demand for safe-haven assets, which tends to affect risk-sensitive pairs in particular. This reaction suggests that traders are adjusting their positions based on growing uncertainty. If fear continues to build in financial markets, we might expect further hesitation from bullish participants.
For those looking at upcoming trades, attention should remain on how price behaves near these resistance levels. If buyers struggle to sustain their momentum, short-term reversals could present opportunities. At the same time, if external factors—particularly news out of the US—cause increased caution, the current bias could weaken rapidly.
