GBP/USD stages recovery bounce from 1.2300 support zone

GBP/USD has rebounded 0.4% to 1.2385 after finding solid support at the 1.2300 psychological level during Wednesday's European session. The pair's recovery follows oversold conditions on the hourly RSI and comes despite ongoing UK economic uncertainty. Sterling's bounce appears technically driven, with buyers emerging at key support levels that held throughout December 2024. The 50-day moving average at 1.2420 now acts as immediate resistance, followed by the 1.2450 zone. Dollar weakness across the board is providing additional lift, though fundamental headwinds for sterling persist with UK inflation concerns and BoE policy uncertainty. Traders are monitoring whether this represents a sustainable reversal or merely a corrective bounce within the broader downtrend. A daily close above 1.2420 would improve the technical outlook, while failure to hold above 1.2350 could see renewed selling pressure toward 1.2300 support.