empty
12.05.2025 12:59 AM
British Pound. Weekly Preview

This image is no longer relevant

The wave pattern of the pound and the market's interest in the news currently reflect those of the euro. Last week, the market had a chance to reduce demand for the GBP/USD instrument, which wouldn't have been surprising even considering Trump's trade war. However, by the end of the week, the U.S. dollar failed to gain even 50 basis points. On the contrary, the pound appreciated again, despite the Bank of England cutting rates and Jerome Powell once more dashing the market's dovish expectations.

In the upcoming week, the market is expected to continue avoiding increased demand for the dollar, with a probability of about 90%. Regardless of economic news emerging from the U.S. or the UK, the market anticipates political, not economic, developments. Trump has started negotiations with many countries and has even reached a deal with the UK, but he has little to boast about for now. One deal out of 75 is hardly a reason to celebrate.

Reports on unemployment, wages, a speech by the BoE's chief economist, the Q1 GDP report, and industrial production are certainly interesting. But if the market had wanted to invest in the dollar, it could have done so last week, when the news flow fully favored dollar growth. Therefore, the pair will remain under Trump's influence—and his alone. The dollar still has limited potential for gains, and only in the absence of positive news from trade negotiations. Even then, gains are uncertain.

By the way, the GBP/USD instrument recently failed to break through the 1.3205 level, which also corresponds to the 100.0% Fibonacci level. As a result, a renewed upward movement in GBP/USD and EUR/USD is very likely, despite the monetary policies of the European Central Bank, BoE, and Federal Reserve, and the state of any given economy.

This image is no longer relevant

Wave Pattern for EUR/USD:

Based on the analysis of EUR/USD, the instrument is continuing to build an upward trend segment. In the near term, the wave structure will entirely depend on the stance and actions of the U.S. president. This should be kept in mind at all times. The formation of wave 3 of the upward trend has begun, and its targets may stretch as far as the 1.25 area. Reaching those levels depends solely on Trump's policies. At the moment, wave 2 within wave 3 appears near completion. Therefore, I am considering long positions with targets above 1.1572, corresponding to the 423.6% Fibonacci level.

This image is no longer relevant

Wave Pattern for GBP/USD:

The wave pattern of GBP/USD has transformed. We are now dealing with a bullish, impulsive section of the trend. Unfortunately, under Trump, the markets may face many shocks and reversals that defy wave structure and any form of technical analysis. The formation of upward wave 3 continues with nearby targets at 1.3541 and 1.3714. Ideally, we would like to see a solid corrective wave 2 within wave 3, but it seems the dollar cannot afford such a luxury right now.

Core Principles of My Analysis:

  1. Wave structures should be simple and easy to interpret. Complex patterns are hard to trade and often require adjustments.
  2. If you're uncertain about what's happening in the market, it's better not to enter.
  3. Absolute certainty in market direction is never possible. Always use protective Stop Loss orders.
  4. Wave analysis can and should be combined with other analysis and trading strategies.
Chin Zhao,
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

GBP/USD Overview – June 9: Nonfarms Did Not Disappoint

The GBP/USD currency pair also traded lower on Friday and even settled slightly below the moving average line. While we constantly say there are no reasons for the pound

Paolo Greco 04:03 2025-06-09 UTC+2

EUR/USD Overview – June 9: A New Episode of the "American Circus"

The EUR/USD currency pair traded with a slight decline on Friday, which was driven by decent macroeconomic data from the U.S. However, reports from the Eurozone also turned out quite

Paolo Greco 04:03 2025-06-09 UTC+2

EUR/USD. Weekly Preview. Inflation and More Inflation

The upcoming trading week will revolve around American inflation. In the United States, data will be published on the growth of the Consumer Price Index (CPI), the Producer Price Index

Irina Manzenko 02:39 2025-06-09 UTC+2

U.S. Dollar: Weekly Preview

In the United States, as usual, there will be far more interesting events and news than in the Eurozone or the United Kingdom. Economic data will start arriving on Wednesday

Chin Zhao 00:55 2025-06-09 UTC+2

British Pound: Weekly Preview

In the United Kingdom, the news background for the upcoming week will be much more interesting, although I do not believe it will significantly impact market sentiment. The pound continues

Chin Zhao 00:55 2025-06-09 UTC+2

Euro Currency: Weekly Preview

Boredom—pure and simple. That's how the upcoming week looks for the European currency. I want to clarify from the beginning that this review focuses solely on the European news background

Chin Zhao 00:55 2025-06-09 UTC+2

The Market Realized That Money Isn't Everything

Which is stronger — money or power? The answer to this question became clear very quickly. In the conflict between the most influential president in the world, Donald Trump

Marek Petkovich 00:07 2025-06-09 UTC+2

Bitcoin Heads for Conflict

The biggest surprise of June has been the divergence between U.S. stock indices and cryptocurrencies. The S&P 500 and Bitcoin are typically considered risk assets, historically moving hand in hand

Marek Petkovich 00:07 2025-06-09 UTC+2

XAU/USD. Analysis and Forecast

Today, gold maintains a positive tone; however, bulls are acting cautiously, preferring to refrain from aggressive buying ahead of the release of the important U.S. Non-Farm Payrolls (NFP) report

Irina Yanina 15:30 2025-06-06 UTC+2

WTI. West Texas Intermediate. Traders Await NFP

Prices for West Texas Intermediate (WTI) crude oil remain in the middle of a three-day range. Prices are supported by hopes for the resumption of trade negotiations between the U.S

Irina Yanina 11:23 2025-06-06 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.