GBP/USD Breaks 1.2650 Support, Bearish Pattern Targets 1.2500

GBP/USD has accelerated its decline, breaking below crucial 1.2650 support to trade at 1.2620, down 0.6% on the day and 2.1% for the week. The confirmed head-and-shoulders pattern on the daily chart projects a downside target near 1.2500, representing another 120 pips of potential losses. Dollar strength continues to dominate as US yields rise following hawkish Fed commentary, while UK economic data disappoints with manufacturing PMI contracting to 47.8. The Bank of England's cautious stance amid slowing growth has undermined sterling support. Technical indicators show RSI entering oversold territory below 30, suggesting a potential bounce, though the broader trend remains firmly bearish. Immediate resistance now sits at the broken 1.2650 level, with 1.2700 as the next major hurdle. Traders are positioning for continued pound weakness, with stop-losses clustered above 1.2680 potentially accelerating any corrective bounce.