The GBP/USD forecast shows a pullback from recent peaks as market participants prepare for a likely Bank of England rate cut. Meanwhile, the dollar remained fragile amid lingering fears of a trade war between the US and China. The Bank of England will hold its policy meeting later in the day, and market participants are pricing a 92% chance of a quarter-point rate cut. This will be the third cut since the central bank started its monetary easing campaign last year. The rate cut will come after a period of weak economic growth in the UK.However, policymakers believe inflation remains high. For this reason, the BoE has been more cautious at cutting than most of its peers, like the BoC and ECB. Market participants expect three rate cuts in the UK this year. However, this will heavily depend on incoming data and the impact of Trump’s policies on the global economy. Meanwhile, the dollar remained fragile after turmoil in the previous session caused by fears of a trade war between China and the US. Trump’s 10% triggered an immediate response from China, indicating a lack of willingness to negotiate. Elsewhere, data on Wednesday revealed that US private jobs increased more than expected. However, a separate report showed that business activity in the services sector fell, with the PMI dropping from 54.2 to 52.8. GBP/USD key events today

 GBP/USD technical forecast: RSI divergence points to fading bullish momentum GBP/USD 4-hour chart On the technical side, the GBP/USD price is pulling back after failing to breach the 1.2501 resistance level. However, the bullish bias remains intact since the price trades above the 30-SMA with the RSI over 50. The previous uptrend paused when the price met the 1.2501 resistance. This led to a break below the SMA and a bearish shift in sentiment. However, bulls returned to retest the level but again failed to keep prices above. Meanwhile, the RSI has made a bearish divergence, indicating weaker bullish momentum. If the divergence plays out, the price will likely break below the 30-SMA to retest the 1.2351 and the 1.2200 support levels. This might start a new downtrend. More By This Author:USD/JPY Price Analysis: Yen Rallies Amid Potential BoJ Rate Hike
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