Insights 
VT 
Technical Analysis Of GBP/USD
In currency movements this month, the GBP was strongest against the Japanese Yen, gaining 3.02%. Heat maps show significant percentage changes against other major currencies, with the GBP showing varied performances depending on the pairing.
Given the current market sentiment on October 13, 2025, the path of least resistance for the British Pound appears to be downwards. The combination of easing US-China tensions and pre-data caution in the UK is weighing on the GBP/USD pair. This suggests that derivative traders should consider strategies that benefit from a declining or range-bound pound in the coming weeks.
We believe the Bank of England’s dovish stance is the most significant factor, especially with inflation still near 4%, double its target. Looking back to the aggressive rate-hiking cycle of 2022-2023, the market’s current expectation of no rate adjustments until March 2026 signals the BoE is more concerned about economic weakness than inflation. Recent data showing the UK economy grew by a meager 0.1% in the second quarter of 2025 supports this view, making any hawkish talk from MPC speakers this week unlikely to be sustained.
US Dollar Influence
On the other side of the pair, while a calmer geopolitical scene might typically weaken the US dollar, the policy divergence between the central banks is key. The latest US CPI data released in September 2025 showed inflation at a more manageable 2.8%, giving the Federal Reserve more flexibility than the BoE. This fundamental difference should continue to support the dollar relative to the pound, even with distractions like the ongoing US government shutdown.
From a technical standpoint, the bearish trend is well-defined, with the price trading below all key short and medium-term moving averages. We would watch the 1.3300 level closely as a trigger point for further downside, making put options with strike prices near the 1.3200 support level an interesting proposition. Any rallies toward the 1.3400-1.3450 resistance area could be seen as opportunities to initiate new bearish positions.
