GBP/USD: Failure to hold 1.2600/1.2570 suggests further losses for the pound

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GBP/USD: Must break last week’s high of 1.2870 to confirm further upside

GBP/USD started to pull back after encountering strong resistance near the upper line of the multi-month channel around 1.3180. Currently, GBP/USD is challenging the bottom of the channel and approaching the late June lows of 1.2600/1.2570, a key support level.

An initial bounce is expected, but a break above last week’s high of 1.2870 is necessary to confirm further upside.

Failure to hold 1.2600/1.2570 could signal further downside risk; the next potential support could be at 1.2480 and the 200-day moving average at 1.2300.