empty
27.03.2025 04:06 AM
GBP/USD Pair Overview – March 27: The British Pound Stalls

This image is no longer relevant

On Wednesday, the GBP/USD currency pair openly traded in a flat range. Volatility remains low, with no trending movements even within the day. In other words, the market is simply stagnant. Notably, traders continue to ignore nearly all macroeconomic and fundamental data. For example, it was revealed yesterday that inflation in the UK dropped to 2.8% and core inflation to 3.5%—both below expectations. What do these reports indicate? They suggest that inflation in the UK isn't as bad as Bank of England Governor Andrew Bailey warned last week. Falling inflation means the BoE may lean slightly more dovish in the near term, and the pound, which had surged for no apparent reason, could at least begin to correct.

However, nothing of the sort happened during the European session. European traders ignored the inflation data, paying no attention whatsoever. So how, even theoretically, can the U.S. dollar appreciate if an important report triggers a 30–40 pip drop in the pound, but the next day—despite no news—the pound randomly rises?

The key takeaway for traders right now is that fundamentals and macroeconomics are not driving logical movements. As a result, even next week—when key U.S. reports on unemployment, business activity, and the labor market are released—the dollar may still struggle to gain ground.

We believe that, under current conditions, only two things can trigger a strengthening of the U.S. dollar:

  1. The market ends its dollar sell-off, concluding that enough is enough. No matter what tariffs or sanctions Donald Trump imposes, the U.S. economy has not seen a significant decline yet. However, the markets have already accounted for all possible Fed easing measures intended to "rescue" the economy.
  2. Donald Trump halts tariff implementation or begins reversing them. Nothing prevents the parties from negotiating. If agreements are reached, the dollar could start to recover, as its main pressure factor would be removed. The decline of the dollar has been driven entirely by Trump's tariff actions. If this factor is removed from the equation, markets will no longer have a reason to sell the greenback.

From a technical perspective, there's nothing new to report. The pair has been range-bound for several consecutive days. On the daily timeframe, GBP/USD is at critical levels—either the correction ends, or the movement turns into a new uptrend. However, we still see no justification for a long-term bullish trend that should logically last several years.

This image is no longer relevant

The average volatility of the GBP/USD pair over the last five trading days is 78 pips, which is considered "moderate-low" for this currency pair. On Thursday, March 27, we expect movement within the range of 1.2809 and 1.2965. The long-term regression channel has turned upward, but the downtrend remains intact on the daily timeframe. The CCI indicator has not recently entered overbought or oversold territory.

Nearest Support Levels:

S1 – 1.2817

S2 – 1.2695

S3 – 1.2573

Nearest Resistance Levels:

R1 – 1.2939

R2 – 1.3062

R3 – 1.3184

Trading Recommendations:

The GBP/USD pair maintains its medium-term bearish trend, while a weak correction has begun on the 4-hour chart. This correction could end anytime as the market continues to avoid dollar purchases. We still do not consider long positions, as the current upward move appears to be a correction on the daily chart that has turned into an irrational, panic-driven rally. However, if you trade purely on technicals, long positions are viable with targets at 1.2965 and 1.3062, provided the price stays above the moving average. Short positions remain attractive with targets at 1.2207 and 1.2146 because sooner or later, the upward correction on the daily chart will end (unless the prior downtrend ends first). The pound appears extremely overbought and unjustifiably expensive, and Donald Trump cannot devalue the dollar indefinitely. However, predicting how long this Trump-driven dollar decline will continue is extremely difficult.

Explanation of Illustrations:

Linear Regression Channels help determine the current trend. If both channels are aligned, it indicates a strong trend.

Moving Average Line (settings: 20,0, smoothed) defines the short-term trend and guides the trading direction.

Murray Levels act as target levels for movements and corrections.

Volatility Levels (red lines) represent the likely price range for the pair over the next 24 hours based on current volatility readings.

CCI Indicator: If it enters the oversold region (below -250) or overbought region (above +250), it signals an impending trend reversal in the opposite direction.

Paolo Greco,
Analytical expert of InstaTrade
© 2007-2025

Recommended Stories

NZD/USD. Analysis and Forecast

The NZD/USD pair starts the new week with a downward bias, gradually moving away from Friday's more than one-week high, although no active selling is observed yet, due to mixed

Irina Yanina 12:20 2025-08-11 UTC+2

GBP/USD. Analysis and Forecast

The GBP/USD pair begins the new trading week with moderate moves, consolidating its recent solid gains. Last week, as expected, the Bank of England cut its interest rate

Irina Yanina 11:10 2025-08-11 UTC+2

Buyback boom on Wall Street

It is unclear whether tariffs will improve the American economy, but for now, they are causing US stock indices to underperform their overseas counterparts. The MSCI World Index excluding

Marek Petkovich 10:09 2025-08-11 UTC+2

EUR/USD. Inflation Decides Everything: The Dollar Awaits an Important Test

The euro-dollar pair began the trading week calmly, almost at the level of Friday's close (1.1642–1.1645). While sellers controlled the situation on Friday, buyers have now taken charge. That said

Irina Manzenko 09:55 2025-08-11 UTC+2

Markets Will Continue to Rise, No Matter What... (there is a possibility of a renewed decline in the EUR/USD pair and gold prices)

This week, the focus of the markets will be on the release of the U.S. inflation report. Market participants will closely monitor how much this important macroeconomic indicator may increase

Pati Gani 09:55 2025-08-11 UTC+2

Gold Falls in Price — Here's Why

Gold futures declined as traders continue to await clarification from the White House regarding its tariff policy, after a U.S. government agency shocked the market last week by officially ruling

Jakub Novak 09:34 2025-08-11 UTC+2

The Dollar Remains Under Pressure

The fact that an increasing number of Federal Reserve officials are leaning toward cutting interest rates as early as this fall is putting pressure on the U.S. dollar and boosting

Jakub Novak 09:22 2025-08-11 UTC+2

What to Pay Attention to on August 11? A Breakdown of Fundamental Events for Beginners

No macroeconomic reports are scheduled for Monday. Therefore, today's market movement will likely remain very weak and non-trending. However, it is worth remembering that Donald Trump remains President

Paolo Greco 06:00 2025-08-11 UTC+2

GBP/USD Overview. Weekly Preview: A Package of UK Data the Pound Does Not Need

The GBP/USD currency pair continues its confident upward movement after a month-long correction. This correction had both technical reasons (price cannot constantly move in one direction, especially in the cryptocurrency

Paolo Greco 03:35 2025-08-11 UTC+2

EUR/USD Overview. Weekly Preview: The Dollar Faces New Challenges

The EUR/USD currency pair is showing all the signs of resuming the upward trend that could be named after Donald Trump. The decline of the US currency essentially began

Paolo Greco 03:35 2025-08-11 UTC+2
Can't speak right now?
Ask your question in the chat.
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaTrade anyway.

We are sorry for any inconvenience caused by this message.