GBP/USD Weekly Forecast: Sterling Outlook Turns Bearish After Key Support Break

GBP/USD extended its decline and broke through the 1.3271 support level last week, confirming that the rebound from 1.3135 has already ended at 1.3502. The bias remains to the downside this week, with 1.3135 as the first target. A firm break below that level would expose the key 1.3008 support. On the upside, a move above the 1.3282 minor resistance would neutralize the intraday bias.

In the bigger picture, the price action from 1.3867 represents a corrective pattern within the broader uptrend from the 1.0351 low. As long as the 1.3008 support remains intact, the medium-term bullish outlook is maintained, and a later break above 1.3867 is favored, opening the way toward the key 1.4248 resistance. However, a firm break below 1.3008 would at least trigger a deeper decline toward the 38.2% retracement of the 1.0351 to 1.3867 move at 1.2524, increasing the risk of a bearish reversal.

In the long term, as long as the 1.4248/4480 resistance zone holds, the long-term outlook remains bearish. This zone includes the 38.2% retracement of the 2.1161 to 1.0351 decline at 1.4480. In other words, the price action from 1.0351 is still viewed only as a corrective pattern within the downtrend from the 2.1161 high. Nevertheless, a decisive break above 1.4248/4480 would be a strong signal of a long-term bullish reversal.

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