GBPUSD rises above the 50% retracement as buyers regain control and target higher levels
by VT Markets
/
Jul 23, 2025
GBPUSD has hit a new session high, breaking past the 50% midpoint of the July trading range at 1.35764. Earlier attempts to break this level faced selling pressure, causing a dip to 1.3552, just below the support at 1.3561.
However, buyers took control again, pushing the pair back above the midpoint and reaching new highs. The key support level is now at 1.3561, which buyers need to maintain to keep moving up.
Upcoming Technical Targets
The next target is 1.35918, with potential further gains pushing towards the 61.8% retracement level at 1.36265.
Given the buying momentum noted by Michalowski, we suggest that derivative traders look into bullish strategies. The successful hold of lower levels and the break above the midpoint indicate underlying strength. Buying call options with strike prices close to the next target levels may be a smart way to join this rally.
This technical momentum is backed by recent data from the U.S. The latest Consumer Price Index (CPI) for April revealed that inflation has eased slightly to 3.4% annually, increasing chances that the Federal Reserve might lower interest rates later this year. A weaker dollar benefits the pound, aiding its rise.
Impact of Central Bank Policies
Historically, when both the U.S. and U.K. central banks signal potential rate cuts, increased volatility often follows. The recent Bank of England meeting recorded a 7-2 vote to hold rates, hinting at possible rate cuts as well. We can use derivatives like call spreads to manage our risk while still aiming for the 61.8% retracement level discussed earlier.
We’ll keep a close eye on the 1.3561 level, as it’s crucial for any long positions. If the price stays above this level, it confirms that buyers are in control. However, a solid break below this support would lead us to exit bullish trades and reassess the market situation.
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by VT Markets
Jul 23, 2025
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