GBP/USD Price Forecast: Consolidates below mid-1.3500s; bullish potential seems intact

The GBP/USD pair struggles to capitalize on the previous day's modest gains and oscillates in a range below mid-1.3500s during the Asian session on Tuesday. The downside, however, remains cushioned as the US Dollar (USD) selling remains unabated on the back of a broadly firmer Japanese Yen (JPY).

That said, firming US Federal Reserve (Fed) rate hike bets, along with geopolitical uncertainties stemming from escalating US-Iran tensions, act as a tailwind for the USD and cap the GBP/USD pair. Traders also seem hesitant ahead of this week's release of the monthly UK GDP and the latest US inflation figures.

From a technical perspective, the GBP/USD pair holds a mild bullish bias above the 200-period Simple Moving Average (SMA) on the 4-hour chart. Moreover, spot prices trade above a dense Fibonacci support stack led by the 38.2% retracement level of the June-August upswing, at 1.3471. Adding to this, a modestly positive Moving Average Convergence Divergence (MACD) and a Relative Strength Index (RSI) hovering around 54 hint that upside momentum is constructive but not yet aggressive.

Meanwhile, the 23.6% retracement at 1.3549 sits just overhead as the next cap. A sustained strength higher would open the way toward further recovery in the broader range. On the downside, initial support is provided by the 200-period SMA at 1.3498, followed by the 38.2% retracement at 1.3471, with deeper floors at the 50.0% level near 1.3408 and the 61.8% retracement around 1.3344 if selling pressure intensifies.

GBP/USD 4-hour chart