FX.co ★ Helsinki | GBP/USD

On the H1 chart, the 200 SMA sits at 1.3580, acting as a resistance cap above the market. The 50 SMA on the same chart is at 1.3570, working as another barrier just overhead. On the H4 chart, the 200 SMA is at 1.3460, serving as a solid support zone farther down. The 50 SMA on the H4 chart is at 1.3575, adding more resistance just above current prices. The current price of 1.3545 is trading below the H1 200 SMA, H1 50 SMA, and H4 50 SMA, but remains above the H4 200 SMA at 1.3460. This setup tells us that sellers have the upper hand, with multiple resistance levels stacked above. On the downside, the key support areas are as follows. First support is at 1.3500, the round number and this week's low. Second support is at 1.3460, where the H4 200 SMA sits as a strong floor. Third support is at 1.3420 to 1.3430, a demand zone from earlier trading. More support levels include 1.3400, 1.3370 to 1.3380, and 1.3360 as deeper cushions. On the upside, the key resistance areas are as follows. First resistance is at 1.3570 to 1.3580, where the H1 50 SMA and H1 200 SMA come together as the first big test. Second resistance is at 1.3600 to 1.3610, the round number and supply zone. Third resistance is at 1.3640 to 1.3650, a recent peak and major barrier. More resistance levels include 1.3680, 1.3730, and 1.3750 as higher targets. The pair remains trapped below the 1.3550 level, with strong selling pressure near 1.3570 to 1.3580. A push above that zone would signal a turnaround, while another rejection could send prices back toward 1.3500.

The British pound is struggling to extend its rebound from the 1.3500 mark, trading near 1.3545 on Wednesday. The pair looks vulnerable to more losses, thanks to several bearish factors lining up against it. The pound is still getting hammered by a deepening political crisis in the UK. More than 80 Labour MPs are demanding Prime Minister Keir Starmer step down after dismal local election results. On the other side of the Atlantic, the US dollar is holding onto the strong gains it made on Tuesday, sitting near a one-week peak. Hotter US inflation data has reinforced bets that the Federal Reserve may need to raise rates again. That is the main weight holding GBP/USD down. Data out Tuesday showed the US Consumer Price Index jumped 3.8 percent year-on-year in April, the biggest reading since May 2023. Core inflation, which strips out food and energy, rose 0.4 percent month-on-month and 2.8 percent year-on-year. Traders are now pricing in roughly a 35 percent chance of a 25 basis point rate hike by December 2026. This has also crushed hopes for a US-Iran peace deal, making the dollar even stronger as a go-to safe haven. On the geopolitical front, President Trump says the ceasefire with Iran is "in jeopardy." Tehran has shot down US proposals to end the war, with big disagreements over Iran's nuclear program and the Strait of Hormuz. Traders are now waiting for the US Producer Price Index report later Wednesday, which could bring fresh action to the market. Geopolitical headlines will likely keep financial markets choppy and offer short-term trading chances. But the bigger picture still leans bearish for GBP/USD, meaning the path of least resistance is lower. The key levels to watch are support at 1.3500 and resistance at 1.3570 to 1.3580. A drop below 1.3500 would target 1.3460 and then 1.3420. A climb above 1.3580 would target 1.3600 and then 1.3640. All eyes are now on the PPI numbers and any fresh political news out of London.