GBP/USD Forecast: Pound Eyes 1.3670 Target Ahead of BoE Decision

The GBP/USD currency pair has turned technically bullish, advancing 260 pips following a liquidity sweep below recent swing lows. While the initial rally stalled upon encountering bearish imbalance 29, the subsequent corrective pullback pushed prices down to 1.3271. Bullish imbalance 31 has now been mitigated, providing a technical structure where buyers may seek renewed upside momentum.

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Fundamental drivers favor the British pound as market expectations lean heavily hawkish ahead of next week's Bank of England meeting, where a rate hike carries a 90% probability. Markets currently project three rate tightenings from the BoE, compared to just one or two from the Federal Reserve over the coming year. Recent FOMC minutes and dot plot projections reinforce this single-hike trajectory, limiting further upside for the US dollar.

Macroeconomic indicators and geopolitical factors offer minimal support for greenback strength. Recent US gross domestic product and inflation reports failed to generate sustained dollar buying, signaling that the currency's rate-driven rally may have run its course. Additionally, safe-haven demand linked to US-Iran geopolitical tensions has softened as the conflict moved beyond its most acute phase.

GBP/USD Technical Outlook

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The pair's broader trading range on the daily timeframe remains well-defined. Having swept liquidity below the May 1 and June swing lows, the market has transitioned back in favor of GBP buyers. Short-term downside scope appears limited as long as support holds near key technical zones.

Traders looking for long opportunities will monitor reactions around bullish imbalance 31 and the underlying order block. A confirmed bounce from these support levels could pave the way for a retest of the trading range's upper boundary near 1.3670. Economic releases on October 30 remain light, leaving technical setups and central bank policy expectations as the primary market drivers.

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