GBP/USD gained momentum following the release of the US labour market report for July 2026 on 7 August. Non-farm employment fell by 23,000 jobs, sharply missing the Reuters survey forecast of an 80,000 increase. The negative reading was notable not only for the size of the miss but because it indicated outright job losses rather than merely slower growth. According to the Bureau of Labor Statistics, employment figures for May and June were also revised downward. The US dollar responded with broad-based weakness across major currency pairs.

On 30 July, the Bank of England maintained its key interest rate at 3.75% in a six-to-three vote, with three committee members advocating for a rate hike. The central bank's decision statement also underscored inflation risks tied to volatility in energy prices. The BoE's still-hawkish stance contrasts with growing market expectations that the Federal Reserve may need to ease policy if US labour market weakness persists, a divergence that has underpinned the pound's relative strength against the dollar in recent weeks.

Technical Analysis of GBP/USD

After a sharp advance from approximately 1.3280 toward 1.3500 in late July, the pair entered a narrowing range defined by an upper boundary at 1.3483 and a lower boundary at 1.3440. These two levels gradually converged, forming a pattern resembling a contracting triangle—a formation that typically precedes a directional breakout as volatility compresses. A green impulse candle subsequently broke above the pattern's upper boundary, and the price is now attempting to consolidate above both the trendline and the profile boundary.

If the bullish scenario plays out, the price could advance toward the red resistance level at 1.3555. However, if the current breakout from consolidation proves false and the price falls back inside the profile, the Point of Control (POC) at 1.3465 and the lower profile boundary at 1.3440 will regain significance for market participants. Below these levels sits the green support area at 1.3420.

The RSI + MAs indicator currently displays three readings of 61, 57, and 57. All three values remain above the neutral zone, and the moving averages are coloured green. Vertical volume, however, has declined relative to the late-July impulse move, a factor traders often monitor when assessing whether a breakout has sufficient participation to sustain itself.

Summary

The attempt to break above the triangle's upper boundary could open the path toward a test of the red resistance area at 1.3555, though the sustainability of any such move may depend on the flow of upcoming US economic data.