GBP/USD Tilts Bullish As Markets Barrel Toward Mid-Week NFP Print

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GBP/USD is holding a broader bullish structure on the daily chart, with price trading well above the 50 Exponential Moving Average (EMA) at 1.3507 and the 200 EMA at 1.3310, confirming the intermediate uptrend that has been in place since the November 2025 low near 1.2300. However, the pair pulled back sharply from its January high of 1.3869 after the Bank of England (BoE) held rates at 3.75% in a dovish 5-4 vote split, with four Monetary Policy Committee members pushing for an immediate 25 basis point cut. Monday's session saw a modest recovery, with price bouncing from Friday's close near 1.3600 to trade around 1.3695, forming a bullish daily candle that reclaimed ground above the 1.3690 level. This area aligns roughly with the late-January consolidation zone between 1.3690 and 1.3770 that previously acted as support before last week's breakdown. UK political uncertainty surrounding Prime Minister Starmer's leadership is adding a headwind, but the broader trend of higher highs and higher lows on the daily timeframe still holds above the 50 EMA.

Tuesday's session carries significant event risk from US Retail Sales (Dec) and the Employment Cost Index (Q4), both due at 05:30 GMT, followed by Federal Reserve (Fed) speeches from Hammack and Logan. The Stochastic Oscillator (14, 5, 5) on the daily chart remains tepid in neutral territory after unwinding from overbought conditions, suggesting room for further upside if momentum builds. A sustained push above the 1.3700 handle on Tuesday would target the broken support turned resistance near 1.3770, with a stronger move opening the path toward 1.3870 (the January swing high). On the downside, weaker-than-expected US data could initially support Pound Sterling, but a surprise beat in Retail Sales or hawkish Fed commentary may drive a retest of the 1.3590 low printed last week, with deeper support at the 50 EMA near 1.3507. The 1.3690-1.3700 zone is the near-term pivot; how price reacts here heading into the US data releases will set the tone for the rest of the week.