FX Report: 10th - 13th March 2025
Buy Side Target
1.3300
Sell Side Target
1.2450
Current Price
1.2940
GBP/USD has been maintaining strong bullish momentum, with price action currently hovering around the 1.29400 level. The market has approached a critical decision point where price could either continue its rally toward the 1.30400 and 1.33000 resistance zones or experience a retracement toward lower levels.
Bullish Scenario:
If price consolidates and successfully breaks above 1.29400, it will signal further bullish strength. A sustained move above this level would increase the likelihood of a push toward 1.30400. If 1.30400 is cleared, the next significant resistance lies at 1.33000, which could serve as a long-term target for buyers.
Bearish Scenario:
Alternatively, if price fails to hold above 1.29400 and begins to show signs of rejection, we could see a pullback toward 1.28400. A sustained move below this level would open the path toward 1.27500 and 1.26400. If selling pressure intensifies, we could eventually see a retest of the 1.24500 support level, where buyers may look to re-enter the market.
Market Outlook:
At the moment, price remains at a key inflection point. Traders should watch for confirmation of either a breakout to the upside or a rejection that could trigger a deeper pullback. As always, staying adaptive to price action and key levels will be crucial in navigating potential market moves.
US Economic Concerns:
- Trade Tensions: Escalating trade disputes between the United States and China have raised fears of a global economic slowdown. China's recent imposition of tariffs on U.S. agricultural products, in retaliation to U.S. tariffs on aluminium imports, has heightened market uncertainty.
- Weak Labor Market Data: The U.S. economy added 151,000 jobs in February, falling short of expectations, with unemployment rising to 4.1%. This has led to increased speculation about potential Federal Reserve rate cuts.
UK Economic Indicators:
- Stable Monetary Policy: The Bank of England is expected to maintain interest rates at 4.5%, with upcoming GDP data likely to influence future policy decisions.
- Labor Market Trends: The UK's job market showed signs of cooling in February, with slower hiring and the slowest rise in starting salaries in four years.
Market Sentiment:
- The British pound has strengthened against the U.S. dollar amidst growing concerns about the U.S. economy.
Economic Calendar Highlights:
- UK GDP Report (March 14): The UK's Gross Domestic Product data release will be closely watched for insights into economic growth, potentially influencing Bank of England policy expectations and GBP movements.
- US Consumer Sentiment (March 14): The University of Michigan Consumer Sentiment Index will provide insights into consumer confidence, impacting market sentiment and USD valuation.
Implications for GBP/USD this week:
This week, the GBP/USD pair is influenced by a combination of domestic and international factors. Key UK economic data releases and Bank of England policy expectations will compete with U.S. labour market reports and Federal Reserve guidance in shaping the pair's direction. Traders should closely monitor these developments, as they are likely to drive significant market volatility.
Last FX Report: 3rd - 6th March 2025
Buy Side Target
1.2760
Sell Side Target
1.2450
Current Price
1.2940
Market Outcome
Bullish
Last week’s analysis highlighted a key decision point for GBP/USD, with price positioned for either a bullish continuation toward the 1.27600 and 1.28350 resistance levels or a potential pullback toward 1.24500 and 1.24100.
As anticipated, price found support at lower levels and continued its bullish trajectory, successfully breaking above key resistance zones. The market demonstrated strong buying pressure, rejecting lower levels and forming a bullish structure that ultimately led to a push toward the 1.27600 region.
How the Analysis Played Out:
Bullish Breakout – Price respected the anticipated support zones, leading to a rally toward the first key resistance at 1.27600.
Higher Lows Formation – Instead of breaking down to the 1.24500 or 1.24100 levels, price consolidated and created a series of higher lows, confirming buyer strength.
Potential for Further Upside – The bullish momentum remained intact, aligning with last week's forecast for a move toward 1.28350.
*Contracts for difference (CFDs) are complicated financial contracts based on leverage, which can possibly result in huge fluctuations in profits or losses. Therefore, it is essential to study and understand CFDs thoroughly before embarking on investment. You should at the same time stay conscious and ready yourself for the potential risk of losing a part or your whole capital. This outlook is non-financial advice, you should consult with your personal financial advisor before making any investment decisions.
How we traded this outlook:
