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 InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

The Yen Has Lost Its Bullish Momentum

The Consumer Price Index (CPI) in the Tokyo region declined in June from 3.4% to 3.1% year-over-year, marking the first signal so far that may indicate a slowdown in price

Kuvat Raharjo 12:21 2025-06-27 UTC+2

EUR/JPY. Analysis and Forecast

The EUR/JPY pair is regaining positive momentum during today's trading session, reversing its recent decline.The euro continues to benefit from the prevailing sentiment of selling the U.S. dollar

Irina Yanina 12:17 2025-06-27 UTC+2

Inflation in Canada Remains Too High – USD/CAD May Accelerate Its Decline

Inflation in Canada remains too high to expect a rate cut by the Bank of Canada at its upcoming meeting. In April, inflation sharply slowed to 1.7% y/y, and most

Kuvat Raharjo 11:16 2025-06-27 UTC+2

XAU/USD. Analysis and Forecast

Gold is drawing renewed selling interest today after breaking below the key $3300 level. Traders are awaiting the release of the U.S. Personal Consumption Expenditures (PCE) Price Index, which

Irina Yanina 10:47 2025-06-27 UTC+2

PCE Index Data Unlikely to Significantly Impact Market Dynamics (Potential for Renewed Growth in EUR/USD and Bitcoin)

The easing of tensions in the markets, following a pause in the military conflict in the Middle East, supports the return of the previous paradigm—an increase in demand for stocks

Pati Gani 09:52 2025-06-27 UTC+2

The Market Is Off the Leash

Greed has returned to the markets. While professionals warn about the need for caution amid geopolitical uncertainty, trade wars, and the state of the U.S. economy, retail investors are once

Marek Petkovich 09:16 2025-06-27 UTC+2

What to Pay Attention to on June 27? A Breakdown of Fundamental Events for Beginners

There are relatively few macroeconomic reports scheduled for Friday. Some experts refer to the PCE indicator as "important" and "the Fed's favorite," but we do not share that view

Paolo Greco 07:02 2025-06-27 UTC+2

GBP/USD Overview – June 27: History Doesn't Repeat Itself

The GBP/USD currency pair continued its strong upward movement throughout Thursday. Since the beginning of the week, the U.S. dollar has lost "only" 330 pips. As we've previously stated

Paolo Greco 03:41 2025-06-27 UTC+2

EUR/USD Overview – June 27: Can Trump Balance the Trade Deficit?

The EUR/USD currency pair is in a "free rise" (similar to the term "free fall"). The dollar is once again plunging into the abyss, just as we repeatedly warned. It's

Paolo Greco 03:41 2025-06-27 UTC+2

Powell, Trump, and Everyone Else

What will change with the arrival of a new Federal Reserve Chair? This is a rather important question, and the answer to it may already have implications for the U.S

Chin Zhao 00:08 2025-06-27 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

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 InstaForex anyway.

We are sorry for any inconvenience caused by this message.