The price actions of the sterling have staged the expected recovery against the US dollar, as the GBP/USD has rallied by 1.2% and almost hit the lower limit of our highlighted resistance zone of 1.3650/1.3680 (printed an intraday high of 1.3645 on Tuesday, 16 September 2025, at the time of writing).
Today’s stellar performance of the GBP/USD (+0.3% has also been reinforced by better-than-expected July’s employment change data for the UK, which came in at 232,000, above the consensus of 222,000, while the unemployment rate remained steady for the third consecutive month at 4.7%, in line with expectations.
Let’s now update the short-term (1 to 3 days) trajectory and key technical elements of the GBP/USD ahead of tomorrow’s FOMC monetary policy decision outcome and the release of the latest Fed economic projections (dot plot).
Fig. 1: GBP/USD minor trend as of 16 Sep 2025 (Source: TradingView)
Preferred trend bias (1-3 days)
A new minor bullish impulsive up move sequence is likely to have kicked off for the GBP/USD from its 3 September 2025 minor bullish reversal low of 1.3333 on the onset of the intraday spike up of the 30-year UK gilt yield over fiscal policy fears.
Maintain bullish bias above a tightened short-term pivotal support of 1.3590/1.3570 on the GBP/USD, with the next intermediate resistances to come in at 1.3715 and 1.3750 (also a Fibonacci extension).
Key elements
- The latest price actions of the GBP/USD since 3 September 2025 have evolved into a minor ascending channel, with its upper boundary now standing at around 1.3750.
- The GBP/USD has traded above its 20-day and 50-day moving averages since 5 September 2025, which reinforces the potential ongoing minor bullish impulsive up move sequence.
- The hourly RSI momentum indicator of the GBP/USD has continued to evolve in a bullish momentum condition as it manages to hold above its ascending support.
- The 2-year yield spread premium between the UK gilt and US Treasury note has continued to expand (inched higher) since the 3 September 2025 level of 0.29% to a current level of 0.45% at the time of writing.
- These observations indicate that short-term UK gilts remain relatively more attractive than US Treasuries due to their yield premium, creating a positive feedback loop that supports further strength in the GBP/USD.
Alternative trend bias (1 to 3 days)
A break below 1.3570 key short-term support in GBP/USD will negate the bullish tone for a deeper minor corrective decline to expose the next intermediate supports at 1.3500 (also the 20-day moving average) and 1.3450 (also the 50-day moving average)
