GBPUSD Nears Early July Targets as DXY Breaks Out

GBPUSD remains vulnerable while below 1.3630. However, the bigger story this week is the US Dollar Index (DXY) testing the 97.70 region.

Read today’s blog for the latest insights on GBPUSD and the DXY:

GBPUSD is approaching the targets I’ve shared in recent videos. The two sell-side imbalances at 1.3509 and 1.3452 became viable targets following the break below 1.3630.

As noted in the recent Weekly Forex Forecast, 1.3630 is a key horizontal level. However, it’s also the location of a trend line from the 2023 high.

GBPUSD broke 1.3630 on Monday and tested it as new resistance on Tuesday. In the VIP Discord group, we’ve discussed how that breakdown opened the door to 1.3509 and 1.3452.

The second imbalance at 1.3452 sits just above the pound’s 2025 trend line support. That will be a significant test for the pair in the coming days.

However, for GBPUSD to get there, the DXY will need to break above 97.70. If the dollar bulls can pull that off, it will signal a significant shift in the dollar’s trend.

So far in 2025, the DXY has dropped over 12%. It’s the worst start for the USD in decades. But no market moves in a straight line, and there are plenty of buy-side imbalances that could pull the dollar higher.

But first, the DXY has to overcome the 97.70 resistance area.

Given the current state of GBPUSD, it seems we may see the pair clean up those single prints toward 1.3452 within the next two days.

That said, remember that the DXY remains below the 97.70 resistance level. In fact, the dollar is once again testing the level at the time of writing.

With that in mind, pairs like GBPUSD could continue to be relatively choppy.