GBPUSD Analysis

Introduction

The GBP/USD, also known as “Cable,” is another major pair, reflecting the economic relationship between the UK and the US. The price of the pair is driven by the Bank of England’s (BoE) monetary policy, as well as political events like Brexit. The GBP/USD is highly sensitive to changes in UK economic data (inflation, GDP) and US economic performance. It tends to move in line with global risk sentiment, with a tendency for volatility during UK political events. This pair also shows a strong correlation with EUR/USD.

Fundamentals and Interest Rates

The Bank of England policy is Dovish with the (BOE) current Interest rate 3.75%. Latest change was Dec 18, 2025 (-25bp)%.
On that side the Federal Reserve policy is Dovish and (FED) has set its interest rate to 3.75% by latest change, Dec 10, 2025 (-25bp).


Based on the economic and macro fundamental data, The Fundamental Bias of GBP is Moderate Bearish and for the USD is Moderate Bullish.
Ziwox considering Moderate Bearish bias for this asset and we expect prices to decline in the long-term.
Our Ziwox A, mid-term Fundamental Score for GBP is -7. and Fundamental Score for USD is -3. So, base on the Fundamental Score, we predict mid-term downside price movement.

Market Overview & Performance

In the current trading session, "Sydney & Tokyo", Market risk sentiment is Classic Risk-ON. The Gold and Australian dollar recorded the strongest performance, while the Yen and Switzerland Frank are weakest so far.

Currencies performance vs US dollar "USD"
Gold "XAU", recorded a 0.34% increase against us dollar.
Euro "EUR", performance has been 0.01% up so far
Australian dollar "AUD", has risen by 0.24%
New Zealand dollar "NZD", has risen by 0.07%
Japanese YEN "JPY", experienced -0.12% fall
Swiss franc "CHF", experienced -0.03% fall so far
Canadian dollar "CAD", has gained 0.05%
Market risk sentiment is ON, This means Investors embrace risk, driving demand for riskier assets and higher-yielding currencies while safe-haven assets weaken.Due to the market risk sentiment, GBPUSD price increase is likely. Becasue investors are optimistic and willing to take higher risk on GBP and leading to increased demand for riskier assets like stocks, commodities, and higher-yielding currencies. Safe-haven assets like the USD, JPY, and gold typically weaken as confidence grows.

Market Sentiment and Positioning

GBP COT (Commitments of Traders):

Institutions Net Position on >British Pound is -84197 included 49270 long, 133467 short and -11511 position changed from last week.
So they mainly have a bearish view on this asset and sold GBP for lower prices in long-term.
Last week -11511 repositioning Indicates more sell positions and price pressure in short-term.

USD COT (Commitments of Traders):

Institutions Net Position on >U.S. Dollar Index is -5882 included 16384 long, 22266 short and -893 position changed from last week.
So they mainly have a bearish view on this asset and sold USD for lower prices in long-term.
Last week -893 repositioning Indicates more sell positions and price pressure in short-term.

Retail Traders:

Crowd traders or Retail traders are bullish on the GBPUSD with 64% 36% ratio. 0 long pos and 0 short position.
We generally adopt a contrarian approach towards crowd sentiment and we give probability GBPUSD prices may decrease.

Technical Levels and Support/Resistance

The GBPUSD pair is approaching a critical technical support level near 1.31434.
Technical trend is Sell, So If the pair continues to weaken, this support could become a significant area to watch for potential reversal or consolidation.
On the upside, there is key resistance near 1.34254. Technically, If the pair continues to the upside, this resistance level could become a significant area to watch for sell entery potential.