GBP/USD: Major Supply Tests the Sterling Rally

#GBP/USD#

GBP/USD has extended its recovery into the 1.3550–1.3570 major supply zone, where price is beginning to show its first signs of hesitation.

The broader move remains bullish. Sterling has been forming higher lows throughout August and has now recovered almost the entire decline from the previous resistance area.

But this is where the rally faces its first serious test.

The same zone previously triggered a meaningful rejection, making it an important area for sellers to defend once again.

From a technical perspective, a rejection here could send GBP/USD back toward the 1.3400–1.3440 major demand zone.

That would still represent a correction within the broader recovery rather than an immediate bearish trend reversal.

The fundamental picture makes the setup more interesting.

Sterling is currently benefiting from a weaker U.S. dollar as markets scale back expectations for another Federal Reserve rate hike. At the same time, stronger-than-expected UK growth has increased speculation that the Bank of England may still need to tighten policy again this year.

That means selling GBP/USD directly from resistance is not without risk.

For sellers, the confirmation would be a clear loss of momentum below the supply zone followed by a break of the latest higher-low structure.

For buyers, a sustained move above 1.3570 would invalidate the immediate rejection scenario and suggest that sterling is ready to continue toward higher levels.

For now, the market is caught between strong bullish momentum and a resistance zone that has already proven its importance.

Does 1.3570 reject GBP/USD again, or is sterling preparing for another breakout?