03.04.202619:06 Forex Analysis & Reviews: GBP/USD. Smart Money. Was there really a breakout?

The GBP/USD pair reversed in favor of the pound and began a fairly strong rise, which ended after another speech by Donald Trump and at the nearest bearish pattern. The price rebounded from imbalance 17, thus forming a sell signal. However, earlier a buy signal had also formed in the shape of a "Three Drives Pattern," and the trend remains bullish. In addition, today or on Monday a bullish signal may form for the euro, which could also support pound bulls. The current chart picture is extremely contradictory. In the near future, the price may once again take liquidity from the latest low and resume growth—or it may not. Everything will depend on Trump's next statements.

Recently, Washington has shown a desire to end the war—but on its own terms. Iran, meanwhile, is willing to end it only on its own terms. Likely because Iran is still not ready to accept Washington's ultimatums, we are seeing constantly shifting rhetoric from Trump. We already saw how different the positions of the two sides are about a month ago. Thus, traders are alternately reacting to improvements and deteriorations in the geopolitical backdrop. For a stronger move in either the pound or the dollar, real evidence of de-escalation or escalation is needed—not just words.

The probability of a decline in both pairs remains quite high, and all current discussions about a possible bullish advance are merely assumptions without confirmation or facts. At the same time, I cannot ignore an important and relatively rare "Three Drives Pattern," marked on the chart with a triangle. It represents three consecutive swings, each slightly lower or higher than the previous one, signaling the end of a bearish impulse (in this case). Thus, technical analysis suggests decent chances for a bullish move, but bulls urgently need geopolitical support. As long as the bullish trend remains intact (above the 1.3012 level), I would focus more on bullish signals. However, at present there are no clear bullish patterns or signals, and geopolitics could push the pound even lower at any moment.

On Friday, the news background provided opportunities for both bulls and bears to act—yes, both. Despite clearly positive data on the U.S. labor market and unemployment for March, the February Nonfarm Payrolls figure was revised downward to -133,000. It is still impossible to clearly determine whether the labor market is recovering. Traders did not even attempt to answer this question today, simply ignoring the data. Were there any reports at all?

In the U.S., the overall information backdrop suggests that, in the long term, nothing but dollar weakness should be expected. Even the war between Iran and the U.S. does little to change that. The situation for the U.S. dollar remains quite difficult in the long term and positive only in the short term. The labor market continues to struggle, the economy is increasingly approaching recession, the Federal Reserve—unlike the ECB and the Bank of England—is not planning monetary tightening in 2026, and last weekend the fourth major wave of protests across the U.S. took place personally against Donald Trump. From an economic standpoint, there are no solid reasons for dollar growth.

A bearish trend would require a strong and stable positive information backdrop for the dollar, which is difficult to expect under Donald Trump. For now, geopolitics has been supporting the dollar for over a month, but this support will eventually fade. It is difficult to say when this will happen, so it cannot be ruled out that the U.S. currency may continue to rise for another week, month, or even several months.

News calendar for the U.S. and the U.K.:

• U.S. – ISM Services PMI (14:00 UTC).

On April 6, the economic calendar contains one important entry. The impact of the news background on market sentiment on Monday may be present, but mainly in the second half of the day.

GBP/USD forecast and trading advice:

For the pound, the long-term outlook remains bullish, but there are currently no active bullish patterns. The recent decline of the pair over the past few weeks has been so strong due to an unfortunate combination of circumstances. If Donald Trump had not initiated the conflict in the Middle East, we likely would not have seen such strong dollar growth. I believe this decline could end just as unexpectedly as it began. However, at present, the bearish phase cannot yet be considered over.

In the near term, traders can rely only on a signal within bearish imbalance 17. This signal has already formed, giving traders an opportunity to sell the pound with a target around the 1.3000 level. However, this signal may be contradicted by geopolitics, a potential bullish signal in the euro, and is already challenged by the bullish "Three Drives Pattern."