GBP/USD Trend Analysis: Potential 470-Pip Decline
By Zain Vawda | 19 February 2026
Market Overview
The GBP/USD currency pair has recently broken a significant ascending trendline, indicating a potential decline of approximately 470 pips. This movement is attributed to a resurgence of the US Dollar and expectations of rate cuts from the Bank of England (BoE).
Technical Analysis
Current Trends
Since reaching a peak of 1.38700 on January 27, 2026, GBP/USD has been on a downward trajectory, consistently printing lower highs and lower lows. The breach of the ascending trendline was confirmed with a daily candle close, setting the stage for a potential drop.
Short-Term Indicators
On the four-hour chart, the Relative Strength Index (RSI) is currently in oversold territory, suggesting a possible short-term rebound before the downtrend resumes. Key resistance levels to watch are around 1.3573 and 1.3651, which align with the 100-day moving average on the four-hour chart.
Market Influences
The recent strength of the US Dollar has been a significant factor in the GBP/USD decline. Upcoming US economic data, including initial jobless claims and the December trade surplus report, could further influence market sentiment. A narrower-than-expected trade deficit could bolster the US Dollar, providing it with a short-term lift.
Long-Term Outlook
Despite the potential for a bounce in the US Dollar, long-term expectations regarding Federal Reserve policy and global trade dynamics suggest that the dollar may face downward pressure. This overarching sentiment could impact the GBP/USD pair's trajectory, potentially preventing a deeper selloff.
Conclusion
For the bearish setup to be invalidated, GBP/USD would need to close above the 1.3700 swing high on the daily chart, which would indicate a shift in control back to the bulls. Traders should remain vigilant and monitor key economic indicators and technical levels as the market evolves.