GBP/USD stays above 20-day MA as BoE-Fed gap boosts pound

On Friday, GBP/USD held above its 20-day moving average while the futures-implied UK-US interest rate spread steepened. The pair traded above both its 20-day and 50-day moving averages and rebounded from an ascending channel that began with the April 6 low.

The currency pair reached 1.3658 on May 1, its highest in two months, and has since traded in a narrow range. It slipped about 0.2% on May 7 after a flare-up in US–Iran hostilities that included exchanges of fire.

Short-term interest rate futures show the market pricing a possible Bank of England move in July. The implied UK-US spread for September 2026 is about 0.66%, up from roughly 0.16% three months earlier.

Market participants identify 1.3530 as a short-term support level. Near-term resistance sits at 1.3590, with a resistance band at 1.3640–1.3665 and the next upside objective at 1.3730. Additional supports are at 1.3490 and 1.3450.

Momentum indicators indicated an easing of recent selling pressure in Asian trading on Friday, with the hourly relative strength index moving out of oversold territory.

Geopolitical developments are being monitored. Markets are awaiting Iran’s response to a U.S. proposal on reopening the Strait of Hormuz after both sides reported exchanges of fire.

Key U.S. releases are scheduled later Friday local time: April nonfarm payrolls and the unemployment rate at 8:30 p.m. SGT, followed by the preliminary University of Michigan consumer sentiment reading for May at 10:00 p.m. SGT. Traders are watching those releases for near-term market moves.