empty
25.03.2025 05:02 AM
GBP/USD Pair Overview – March 25: The Pound Rises Before It Even Wakes Up

This image is no longer relevant

On Monday, the GBP/USD currency pair again showed upward movement. The pound sterling began rising overnight despite no clear reasons or fundamental drivers. Yet the market on Monday clearly demonstrated that it remains biased toward buying the pound—or rather, selling the dollar.

At present, the correlation between the euro and the pound is relatively low. Both European currencies are rising, but the pound is rising more strongly and correcting less. It's almost as if we're comparing Bitcoin and Ethereum. The Federal Reserve's monetary policy no longer seems relevant to the market because of Donald Trump's trade policy. Meanwhile, the eurozone and the UK don't have such a disruptive factor, so the market still pays attention to the monetary policies of the European Central Bank and the Bank of England.

What is the monetary policy stance of European central banks? The ECB is continuing its easing measures and has officially stated that inflation is close to the target, while GDP figures are raising concerns. As a result, the ECB is lowering rates—not because inflation needs to be fought, but because the economy needs stimulus. In the UK, the situation is the opposite. Inflation has been rising recently, and Andrew Bailey has suggested it could reach as high as 4% soon. The Bank of England is unwilling to tolerate high inflation and believes the economy can wait.

Therefore, the British central bank is in no rush to lower its key rate, which supports the pound sterling—a form of support the euro lacks. From a technical standpoint, the GBP/USD pair clearly shows an upward trend in the H4 timeframe. At the same time, a downward trend is still visible on the daily and monthly timeframes. One might assume we're at an inflection point—where both long-term trends may end. But that would imply the dollar is now set for a prolonged decline. Can Donald Trump continuously suppress demand for the U.S. dollar while also wanting it to remain the "world's reserve currency"?

Understanding what Trump wants is extremely difficult. Some of his goals contradict one another, and some defy logic and common sense. Forecasting Trump's next moves is like trying to predict the flight paths of seagulls over the sea. So, all that's left is to rely on raw technical analysis—since the market is paying attention to nothing but Trump and his decisions.

But if we try to look beyond the Trump narrative, we still believe the dollar has become far too cheap. Trump hasn't yet caused severe damage to the U.S. economy, yet the dollar has plummeted as if a recession were already at the doorstep.

This image is no longer relevant

The average volatility of the GBP/USD pair over the last five trading days is 69 pips, which is considered "moderate-low" for this currency pair. On Tuesday, March 25, we expect the pair to trade within a range of 1.2850 and 1.2988. 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 currency pair maintains its medium-term downtrend, while a weak correction has begun on the H4 timeframe. We still do not consider long positions, as we believe the current upward move is simply a corrective rally that has taken on an irrational, panic-driven character. However, if you trade based solely on technicals, long positions are relevant with targets at 1.2988 and 1.3062 as long as the price remains above the moving average. Short positions remain attractive with targets at 1.2207 and 1.2146 because the upward correction on the daily timeframe will end sooner or later—unless the prior downtrend is entirely reversed. The pound sterling appears extremely overbought and unjustifiably expensive, and Donald Trump won't be able to devalue the dollar indefinitely. However, predicting how long this "Trump-driven" dollar drop 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

GBP/USD Overview – May 30: Justice Has Prevailed, but for How Long?

The GBP/USD currency pair closed below the moving average line on Thursday, and the dollar strengthened for three consecutive days. However, everything changed in the second half

Paolo Greco 03:51 2025-05-30 UTC+2

EUR/USD Overview – May 30: Checkmate to Donald Trump

The EUR/USD currency pair continued its slight downward movement on Thursday morning but surged sharply upward in the afternoon. We observed a strong emotional reaction from traders linked

Paolo Greco 03:51 2025-05-30 UTC+2

Trump's Authority Has Been Seriously Undermined

In this review, I will try to explore why the cancellation of Donald Trump's global tariffs is more likely to be negative for the U.S. dollar than positive. At first

Chin Zhao 00:51 2025-05-30 UTC+2

EUR/USD: FOMC Minutes, U.S. GDP, and the Legal Battle

The FOMC minutes released on Wednesday did not excite EUR/USD traders, leaving buyers and sellers unimpressed. The minutes reflected the key points from the accompanying statement and the main messages

Irina Manzenko 00:50 2025-05-30 UTC+2

The Dollar Puts on a Brave Face Amid Adversity

Don't look for a black cat in a dark room—especially if it isn't there. The verdict by the U.S. Court of International Trade declaring the White House's universal tariffs illegal

Marek Petkovich 00:50 2025-05-30 UTC+2

XAU/USD. Analysis and Forecast

The decline in gold prices below the $3300 threshold has triggered a wave of weakness, with the precious metal struggling to regain momentum. Global risk sentiment received a strong boost

Irina Yanina 19:35 2025-05-29 UTC+2

Tariff court ruling fuels new market uncertainty

What is life if not a game? Markets, like children, no sooner master one game than they're handed another. In 2024, investors fixated on how many times the Fed would

Marek Petkovich 11:28 2025-05-29 UTC+2

Opposition to Trump Within the U.S. Intensifies (Potential for Continued Growth in #SPX and #NDX)

Domestic opposition to Donald Trump is gaining momentum, which could be an unpleasant surprise for the former president. This development may limit his efforts to reshape the U.S. economic landscape

Pati Gani 09:49 2025-05-29 UTC+2

What to Pay Attention to on May 29? A Breakdown of Fundamental Events for Beginners

Very few macroeconomic reports are scheduled for Thursday. The macroeconomic event calendars for Germany, the United Kingdom, and the Eurozone are empty. Only the United States will release reports

Paolo Greco 06:58 2025-05-29 UTC+2

GBP/USD Overview – May 29: The Dollar Begins to Believe in Miracles

On Wednesday, the GBP/USD currency pair traded with a slight decline, but it's hard to believe in further strengthening the U.S. dollar under the current circumstances. On the one hand

Paolo Greco 03:32 2025-05-29 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.