GBPUSD Reflects Deteriorating Momentum Within an Increasingly Defensive Structure

Market Analysis – January 12

GBPUSD reflects deteriorating momentum within an increasingly defensive structure. GBPUSD is exhibiting a renewed bearish tone, supported by clear alignment between trend direction and weakening momentum signals. Price action remains capped beneath the short-term moving average, which has begun to slope lower and now acts as overhead resistance near $1.3460. Momentum conditions further validate this stance, as the MACD is losing upside traction and drifting toward a negative crossover, highlighting exhaustion in the recent recovery phase. This configuration reflects an environment dominated by supply rather than sustained demand, reinforcing the broader downtrend narrative.

GBPUSD Key Levels

Supply Levels: $1.3630, $1.3800, $1.4000
Demand Levels: $1.3050, $1.2710, $1.2550

GBPUSD Long-Term Trend: Bearish

The pair continues to struggle for acceptance above the established supply band between $1.3600 and $1.3650. Each advance into this region has been met with firm selling, aligning with historical bearish order blocks and followed by decisive breaks in daily market structure. The development of successive lower highs and subdued bullish reactions near $1.3500 underscores persistent seller influence, while supports around $1.3340 and $1.3250 remain vulnerable after repeated testing.

Looking ahead, technical conditions continue to favor downside extension. A decisive breakdown below $1.3340 would likely attract increased selling pressure toward $1.3180, with scope for a deeper retracement into the demand zone near $1.3050. If broader dollar strength and risk-off sentiment persist, additional weakness could bring $1.2710 and potentially $1.2550 into focus over the medium term. Within this framework, upside movements are expected to remain corrective, keeping the bearish outlook intact below $1.3630.

GBPUSD Short-Term Trend: Bearish

GBPUSD on the four-hour chart is showing a clear bearish bias as price trades below the short-term moving average and fails to sustain upside momentum. Repeated rejections from the $1.3600–$1.3630 supply zone confirm strong selling interest and reinforce the prevailing distribution phase.

Price action is compressing beneath a rising trendline near $1.3450, increasing the risk of a downside break toward $1.3320 and $1.3180. With MACD momentum flattening and turning lower, short-term rebounds are likely to remain corrective, aligning near-term forex signals with a broader bearish continuation.

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