GBP/USD sees 1.2190 on post-Fed reaction, settling back to Thursday's opening bids

• The GBP/USD is seeing some bullish play on the charts with a firm bounce after comments from Fed Chair Powell.
• US Initial Jobless Claims beat expectations, helping to improve investor mood and sending the US Dollar lower.
• Several Fed officials still scheduled to speak before the trading week closes out.

The GBP/USD climbed to an intraday high of 1.2192 on Thursday after softer comments from Federal Reserve (Fed) Chairman Jerome Powell landed heavy on the US Dollar (USD), taking the broad Dollar Index (DXY) down and giving the Pound Sterling (GBP) a much-needed boost, extending a rebound from the day's early lows near 1.2090.

Powell speech: Higher yields take some pressure off Fed to raise rates

Fed head Jerome Powell struck a notably muted tone in his appearance at the Economic Club of New York. Chair Powell discussed the relative strength of the US economy moving forward, as well as nodding to the fact that pressure on the Fed to raise rates further appears to be easing, sending the US Dollar broadly lower as investors celebrated the potential for easing rate pressures looking forward, with market sentiment spurring firmly into risk-on territory.

Several Federal Reserve officials are slated to give speech notes over the next 24 hours before the US central bank enters the "blackout" period ahead of the next policy meeting and ensuing rate call.

Looking ahead to Friday, the GBP will be closing out the trading week with a UK Retail Sales data read, with median market forecasts calling for a decline in September's Retail Sales, with negative growth of -0.1% expected compared to August's 0.4% increase.

GBP/USD Technical Outlook

Despite Thursday's Fed-fueled bullish spike, the GBP/USD remains firmly entrenched in bear country on the daily candlesticks; the pair has failed to generate a sustained bull move since sinking to 1.2037 at the beginning of the month, with the last move up failing to make a meaningful break of the 1.2300 handle.

The GBP/USD continues to see play on the bearish side of the charts, with the 50- and 200-day Simple Moving Averages (SMA) etching in a bearish cross near 1.2450.

A bearish continuation will quickly see the Pound Sterling challenging 2023';s lows at 1.1800, while a topside recovery will need to first mount and extend from the 1.2300 key level as the 50-day SMA is set to drop into price action and add technical resistance.

GBP/USD Daily Chart

GBP/USD Technical Levels