GBP/USD remains stable around 1.3415 during the early European session on Friday. The cross maintains a bearish sentiment below the 100-day SMA. The immediate resistance level is identified at 1.3420, while the initial downside target to monitor is 1.3343. The GBP/USD pair is trading in a stable manner around 1.3415 during the early European trading hours on Friday. Traders are inclined to remain on the sidelines in anticipation of the forthcoming release of the monthly UK Gross Domestic Product.
The UK economy is projected to experience a contraction of 0.1% in April, in contrast to an expansion of 0.3% noted in the prior reading. If the report shows a stronger-than-expected outcome, this could support the British Pound against the US Dollar in the near term. Conversely, instability in the Middle East may enhance the appeal of a safe-haven currency like the Greenback, potentially serving as a headwind for the major pair. On Friday, it was reported that US forces intercepted and shot down two Iranian one-way attack drones in the vicinity of the Strait of Hormuz, following Iran’s attempt to target commercial vessels navigating the waterway.
In the daily chart, GBP/USD exhibits a slightly bearish near-term bias, remaining below the 100-day simple moving average and the Bollinger upper band. Price is also fractionally below the Bollinger middle band, which keeps the spot capped by nearby dynamic resistance. Meanwhile, the Relative Strength Index at 48 leans neutral, indicating a consolidative tone rather than impulsive selling for the time being.
On the topside, initial resistance is positioned at the Bollinger middle band around 1.3420, succeeded by the 100-day SMA at 1.3472, with the upper Bollinger band near 1.3500 further consolidating a broader supply zone. On the downside, the next notable support is the lower Bollinger band around 1.3343, where a break would open the door to a deeper retracement within the broader range.