01.09.202519:51 Forex Analysis & Reviews: GBP/USD Analysis on September 1, 2025

The wave structure for GBP/USD continues to indicate the formation of an upward impulse wave pattern. The wave picture is almost identical to EUR/USD, since the only real driver here remains the U.S. dollar. Demand for the dollar is declining across the market in the medium term, so many instruments show nearly identical dynamics. At this point, wave 4 is presumably complete. If that is indeed the case, the instrument's growth will continue within impulse wave 5. Wave 4 may take the form of a five-wave structure, but this is not the most likely scenario.

It should be remembered that much in the currency market now depends on Donald Trump's policies—not only trade-related. From time to time, positive news comes out of the U.S., but the market constantly factors in full economic uncertainty, contradictory decisions and statements by Trump, and the White House's hostile and protectionist stance. Global tensions are rising, and as already noted, the dollar remains the main factor behind the current situation. That is why it is taking all the pressure.

The GBP/USD rate rose by several dozen basis points on Monday, which had no impact on the current wave structure, which still assumes the formation of an upward set of waves. If the current wave structure is correct, then we are now observing the construction of wave 3 within 5, which may turn out to be quite extended and complex. However, this week the news background will play a major role, as the outcome of the September 17 FOMC meeting will largely depend on it.

It should be recalled that the market is 90% confident that the Fed will resume its monetary easing cycle in September. I would phrase it differently: by the end of the year, the Fed may either not cut rates at all, or lower them by as much as 1.5%. This is not a joke. On Monday, it became known that one of the FOMC governors, Mary Daly, joined the "dovish" wing, which is expanding under Trump's pressure more and more each day. Therefore, I personally would not be surprised if by year's end the U.S. president persuades several more governors, and "doves" within the FOMC outnumber "hawks" and pragmatic members.

It should also be remembered that Fed rate cuts will accelerate inflation in the U.S., which so far has barely reacted to Donald Trump's tariffs. In other words, the U.S. president may achieve through his actions precisely what he now uses as justification for demanding monetary easing from the Fed. A paradox. However, the market is more concerned that the Fed could come under excessive political influence from Trump, and therefore demand for the U.S. currency may continue to decline. At this stage, I do not expect a different outcome.

General Conclusions

The wave structure for GBP/USD remains unchanged. We are dealing with an upward, impulse segment of the trend. Under Donald Trump, markets may face many more shocks and reversals that could significantly affect the wave picture, but for now, the working scenario remains intact. The targets for the upward trend segment are now near 1.4017. At present, I assume that the formation of corrective wave 4 is complete. Wave 2 within 5 may also be finished. Therefore, I recommend buying with a target of 1.4017.

Basic principles of my analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to trade and often change.
2. If there is no confidence in what is happening in the market, it is better to stay out of it.
3. One can never have absolute certainty about the direction of movement. Always remember to place protective Stop Loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.