Gbp rises amid declining US housing market and upcoming economic indicators

GBPUSD Analysis

Performance after Tuesday
Period	Pct	Chg	Momentum
Tuesday	0.67%	90.3 Pips
Week to-date	1.25%	167.6 Pips
June	1.2%	161.7 Pips

Upcoming key events (London Time)

Wed 03:00 PM USD Federal Reserve Chair Jerome Powell testifies
Thu 01:30 PM USD GDP annual rate

What happened lately

In the United States, the House Price Index for April 2025 saw a decline, dropping to -0.4% from -0.1% in March, as reported by the Federal Housing Finance Agency (FHFA). This continued decrease suggests a cooling down in the housing market, which may indicate a broader economic slowdown or a specific sectoral adjustment within the real estate market. The decrease in house prices might affect consumer wealth perception and spending, potentially leading to broader economic ramifications, including reduced consumer confidence and lower household spending.

In terms of upcoming events, significant U.S. economic indicators and testimonies are scheduled, with Federal Reserve Chair Jerome Powell set to testify, and the release of the Gross Domestic Product (GDP) annual rate. These events are anticipated to provide crucial insights into the Federal Reserve’s perspective on monetary policy and economic growth. Their outcomes may heavily influence market expectations and could instigate volatility in currency markets.

The 0.67% rise in GBPUSD, reaching 1.36103, reflects market reactions primarily driven by the U.S. economic indicators or sentiment anticipation surrounding the UK or global market conditions at that point. The decrease in the U.S. House Price Index could exert downward pressure on the U.S. dollar, possibly making the GBP more attractive relative to the USD, as investors adjust their risk positions in anticipation of future economic signals. Upcoming high-impact events, such as Powell’s testimony and GDP data, are likely to create further fluctuations in GBPUSD. If Powell’s testimony or GDP figures suggest strong economic growth or a hawkish stance on interest rates, it may strengthen the USD, potentially reversing the recent gains seen in GBPUSD. Conversely, any sign of dovish policy or weaker-than-expected GDP data could enhance the GBP’s standing against the USD. Therefore, traders and investors will be closely monitoring these events for cues on future GBPUSD movements.

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What can we expect from GBPUSD today?

GBPUSD on Tuesday rose 0.67% to 1.36103. Price is above 9-Day EMA while Stochastic is rising.

Updated daily direction for GBPUSD looks bullish as the pair ended higher after Tuesday trading session.

Looking ahead for the day, immediate upside resistance level is R1 at 1.36664 with break above could target R2 at 1.37225 or figure level area. While towards the downside, we are looking at daily low of 1.35178 as an important support. Break below this level could weaken the current bullish momentum. A break above 1.36482 may suggest continuation after recent positive movement.

For the week to-date, take note that GBPUSD is mixed as compared to the prior week.

Key levels to watch out:

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